Factors That Determine Insurance Premiums

There are numerous factors that may be taken into account to determine the cost of the insurance premiums for your New Jersey home. As with most policies, the costs of premiums are based on the likelihood of a claim being made. The less risk that you and your home pose to your insurance provider, the lower the cost of your insurance coverage.

The location of your house can be a major cost factor, due to some areas being prone to more insurance claims than other areas. For example, if you live in a high crime area, you’ll likely pay more for coverage than the same house situated in a low crime area. Other factors include how close your home is to the nearest fire station, or even fire hydrant.

Another significant cost factor is the amount needed to rebuild your house from the ground up, not including the value of the land it’s sitting on. The size of your house and the types of materials used in construction are also taken into consideration.

The third considerable cost factor is the level of your liability risk. Certain breeds of dog, a swimming pool, and owning a trampoline can all increase your liability risk. There are safety measures you can install that may lower your insurance cost, but these items may still cause your insurance premiums to be higher than a home without them.

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