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Certain items could raise home insurance premiums

January 15, 2015

If you're on the verge of buying a new home, there are certain costs and fees that you should consider before snapping up a property. While the overall price of the home is obviously the biggest hurdle, there are certain items that could end up costing you more in insurance premiums, and often times the costly features are what might attract you to that particular home.

A swimming pool could raise the insurance costs of your home.
For example, a waterfront property has its charms—and usually costs more than a similar home in the mainland—but an ocean, lake or river view typically comes with a higher risk for flooding and, consequently, higher insurance costs.

According to MSN Real Estate, a waterfront view could mean an extra $3,000 or more in annual insurance premiums.

“It can be a big, big problem if you get in a situation where none of the big companies want to insure you,” Tim Gaspar, owner of independent insurance agency, told MSN Real Estate. “You have to go to a high-risk company, and they can charge whatever they want to charge you.”

Fox News reported that most residents who reside in a high-risk flood zone with a water view are asked to invest in a separate flood policy in order to protect their home and property.

Pool party premiums

Sticking with the water theme, if your home has a swimming pool, insurance rates could skyrocket due to the high rate of drowning and severity of water-related injuries, according to Fox News. You might even be held liable if a neighborhood kid falls into your pool and sustains an injury, forcing you to pay hospital bills and potential court and lawyer fees if the kid's family decides to take you to court.

While most standard homeowner insurance policies include a $100,000 minimum coverage for liability in order to protect you against a lawsuit, the Insurance Information Institute urges homeowners with a swimming pool to up their policy to $300,000 to increase liability coverage.

An addition to those costs, your insurer might ask that you spend some additional coin to build a self-locking fence that surrounds the pool and keeps children out.

?Fire in the hole?

Another factor that could increase insurance rates is how far your home is from a fire station. If it's more than 5 miles from a station, your rates are likely to climb, and they might even go up by 20 to 240 percent, depending on how far the home is from fire hydrants and the fire station.

Dick Luedke, a spokesman for State Farm, the largest provider of homeowners insurance in the country, said if there are a lot more claims throughout the year in a given area, the risk of a fire is greater.

“We believe it's more accurate that way,” Luedke said. “If you rate how close you are to a fire department, you're not taking into account the proficiency of the fire department.”

While it's hard for the average person to calculate how many claims were in a particular area, they can ask an insurance agent to estimate the costs based on different variables.

“Homeowners insurance has always been very competitive, so the tried-and-true way to save money is to shop around,” Jeanne Salvatore, senior vice president and consumer spokeswoman for the Insurance Information Institute, told MSN Real Estate.

Jump around?

Trampolines are another surefire way to raise your home's insurance premiums, according to Fox News.

There are nearly 100,000 trampoline-related incidents every year, according to a survey by the U.S. Consumer Product Safety Commission's National Electronic Injury Surveillance System. Depending on the state you live in and your insurer, trampoline-related claims may be omitted from your policy. So if someone is injured on your trampoline and decides to take legal action, you might be paying the legal costs out of your own pocket.