A Guide to Home Insurance in Alaska (AK)

It is critical to get Alaska Home Insurance if you are a property owner in Alaska in order to properly protect both your home and its contents.

The aim of any home insurance is to enable you to replace the building and its contents in the event of damage occurring to either. In order to do this you need to make sure that you get better than average home insurance in Alaska, because there can be considerable differences between policies in terms of what they do and do not cover.

For example, average Alaska Home Insurance will not cover you for flooding or earthquakes, so if you want either of those then you would have to pay additional premiums.


So what is average Alaska Home Insurance?


An average Alaska Home Insurance policy is designed to protect you in the event of property damage, medical payments to other people in the event that they are injured in your home, and personal liability cover in case people who visit you in your home end up suing you.

An average home insurance policy in Alaska would normally be called an HO-3 policy, which would cover you for the above, but would come with specific exclusions that you would not be covered for.
In this regard it is quite similar to travel insurance, where if you read the policy carefully you will find a whole range of scenarios under which you would not be covered.

But actually an average HO-3 Alaska Home Insurance policy would cover you for most typical scenarios such as fire and theft, and the onus is very much on the purchaser of the product to check that any typical problems that they can foresee are properly covered by any policy that they choose to purchase.


Some Typical Types of Alaska Home Insurance Cover

1/ Dwelling Coverage – You need to make sure that you could replace your home and its contents in the event that it was totally destroyed, and so you need to factor in not only the current market value of your home, but also the materials that went into constructing it, additional buildings such as garages or sheds, and any special features that your home might have (such as panic rooms for example) which could add to any reconstruction costs.

You should also review this figure periodically, as costs do change over time (though it is fairly common practice among Alaska Home Insurance Companies to automatically adjust the levels of cover in line with inflation); and also to keep your company updated when you add extensions to your home, do major renovation work, or make big structural alterations such as re-fitting a new kitchen or having a loft conversion.

All of these factors can add to the cost of any home insurance policy that you do have, and may require you to increase the levels of cover or take out additional levels of cover.

Remember that Alaska Home Insurance is typically going to be provided under an ‘all perils’ basis, which means that unless the policy specifically excludes something then you would be covered.

2/ Other Structures Coverage – Another very common element is Other Structures Coverage which will normally be around 10% of the Dwelling Coverage figure and will cover outbuildings, garages, sheds etc that are on the land you occupy, but are not the main dwelling.

Because this figure of 10% is relatively low it is worth considering increasing this figure, particularly if you have a number of outbuildings or constructions.

3/ Personal Property Coverage – This component of Alaska Home Insurance will cover you for losses or repairs needed to your personal property in the event that it gets damaged. On average this will normally be about 50% of the dwelling coverage figure, but this will fall normally to only 10% if the property is damaged away from the main dwelling.

So, for example, a fountain pen that was stolen from your home as compared to a fountain pen that was stolen from your office would be treated differently in most policies.

As with most types of insurance you are free to increase the amounts of personal property cover that you have, but additional premiums will be payable.

Personal Property cover will typically NOT cover roomates or boarders, and also will not cover your car or powered boat (smaller boats or canoes without engines may be covered)

Personal Property Cover differs from Dwelling Coverage because it is generally done on a ‘named perils basis’; so that the cover is specifically for perils that are named in the policy, rather than those that are excluded.

These would normally include fire, windstorms, lightning, hail, riot or civil commotion, explosion, vehicles, aircraft, vandalism, smoke, theft, malicious mischief and falling objects.

Note the omission of flooding and earthquakes. So if you want extra layers of protection for your property, then again you are going to have to pay for more cover.

4/ Other Types of Cover – Some other types of cover that you would expect to be included in an Alaskan Home Insurance policy would be Loss of use or additional living expenses, medical payments expenses for other people injured in your home, and personal liability cover in case you get sued.

The US Government has released figures that show that the average Alaska Home Insurance cost was $861 in 2007, according to figures released in 2011.

Naturally, the cost of Alaska Home Insurance will to a large extent depend on the cost of your home and where you live. So here are some statistics for the prices of homes in Alaska.


The Most Expensive Counties for Alaska Homes

According to Trulia Real Estate here were the five most expensive counties in July 2011 for real estate prices in Alaska, based on the average listing price of a home in that county.

Aleutians West - $6,519,251
Sitka - $650,677
Bethel - $624,763
Ketchikan Gateway – $367,854
Lake and Peninsula - $365,828

The Cheapest Counties for Alaska Homes

Yakutat - $102,000
Yukon-Koyukuk - $158,617
Nome - $178,000
Haines - $191,558
Wrangell-Petersburg - $209,643

Regardless of which county in Alaska you live it is a good idea to first shop around for Alaska Home Insurance Quotes so that you can be sure that you are getting the best possible deal.

In reality the rates can vary quite dramatically between home insurance companies in Alaska, and so taking proper care and attention in your search for the best policy will almost certainly end up saving you money.



 

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