Florida Home Insurance Quote – How Rates Are Derived

Did you ever wonder how the carriers come up with pricing for Florida home insurance?  I did.  When you are in the market for a Florida Home Insurance quote , you may be interested to learn how they come up with these varied premiums.  I will give you the basics of what I know about this topic here.

Premiums for regular FL homeowners insurance or HO-3 (Special Form) is based on 3 factors of rating:  the fire protection available, the construction of the house, and the location.

The fire protection means the distance from a water source.  This is known as the protection class or PC.  Generally speaking, homes that are within 1000 feet of a fire hydrant and within 5 miles of a fire station receive a lower rate than a home that has no fire hydrant nearby.  Sometimes, you can’t find any carriers in your area to insure your home if there is no hydrant and a fire station is outside 5 miles.  If there is no hydrant, but a fire department within 5 miles, then you have more options, but pay a higher premium.

How Your Home is Built Affects Your Florida Home Insurance Quote

Secondly, the construction of the house is important.  Homes that are built with masonry or concrete block receive a lower rate than homes built with wood.  The reason block is less expensive…Yes, you guessed it.  Masonry is fire-retardant and will keep the cost of rebuilding your home down in the event of a loss.  Even though the rates per thousand is less for masonry, the replacement limit or amount of insurance required to insure your home is lower for wood frame.  It just costs more to buy concrete.  But, usually, the rates are still more expensive for a wood frame construction.

Finally, we need to consider location.  Carriers rate differently from area to area.  Some areas have more crime, other areas have and increased chance of storm activity that can wipe out many homes in one shot.  Truth be told, there are quite a few sub-elements in this section, but I want to just keep it brief for this post.

A “key premium” is established and multiplied by a “key factor” based on the limit of the house, or the amount of insurance on the home to produce the homeowners base premium.  The key premium and factor takes into consideration the above mentioned elements; the fire protection available, the construction of the house, and the location.

Luckily, we don’t have to calculate all these factors with pencil and paper when you request a Florida Home Insurance.  Let’s let the computer do all the work.  RTC Insurance Advisors has access to the top 37 Florida home insurance companies and would like to run a new rate for you.  Perhaps you are overpaying for your premium.  Why not give us a call at 352-200-2066 today to find out?  Or, fill out the form below for your quote.  Thanks and we look forward to being your agent.

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