"Homeowners should use

smart tactics that allow them to get the most for their premium dollars,"

says Richard Roll, president of the American Homeowners Association. "Smart

homeowners insurance tactics include knowing the pitfalls to avoid, as

well as the right steps to take."

What does a homeowners policy

include? In a nutshell, this type of insurance is a two-part package that

protects the property itself against damage, plus a liability component

that provides coverage for any legal fallout resulting from injury to

others caused by your family. Simple enough. But, embedded in that simple-sounding

insurance policy are a lot of options and myriad questions to be answered

in order to design the right policy for your specific situation.

Where to begin reviewing the

homeowners insurance? First, do the basics.Be sure you have a home inventory.

Too many homeowners fail to create this all-essential documentation of

their possessions for insurance purposes. Without it, you'll be unable

to verify any losses for tax purposes. Your claims will take longer to

settle. �Worst, you will probably not be carrying the right amount of

insurance in the first place.

Next, be sure you have enough

coverage but not too much. "One pitfall to avoid is overvaluing your

home and buying more insurance than you really need," advises Roll.

"Owners sometimes make the mistake of using the purchase price of

their home, which includes the value of the land, instead of the replacement

cost for the structure, to establish their coverage amount. That's a big

mistake."

Updating the policy annually

is another important tip, says Roll. Coverage needs change more often

than you may think. When you make home improvements; when a family member

moves away; if you start a home business; are all changes that affect

your homeowners insurance needs. In some cases you may need additional

coverage. In others you may need less.

Actively looking for ways to

reduce premiums can really pay off. Talk to your insurance agent about

discount opportunities. �Sometimes making a certain type of home improvement

can bring reduced rates. Increasing your deductible to $1,000 can reduce

your premiums as much as 25%. Some companies offer discounts to retirees.

�Shop around and compare prices. Then, talk to your agent and see if the

company you're currently with will give you a discount to stay with them

rather than watch you take your business elsewhere.

For more information on homeowners

insurance go to https://www.ahamembership.com/aha_side_insurance_tactics.cfm.

For more information on any

aspect of buying and owning a home go to www.ahahome.com, the website

of the American Homeowners Association (AHA)®.

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