Frequently Asked Questions

The many types of insurance available to us tends to be confusing. However, when it comes to the question of who needs insurance, there's only one answer: you do. That's why we want to help you understand and choose the right coverage. Basic information on a variety of insurance is included here to assist you. Simply select the type of insurance below. If you would like additional information or have any questions, please feel free to contact us by a visit to our office, a phone call or by email.
The Basics of Homeowners Insurance

Homeowners is one of the most popular forms of personal insurance available and a typical policy will have two sections. The first section covers your property. The second section provides personal liability coverage (should someone get hurt on your property and file a lawsuit against you). If you own or lease property, you should have this type of insurance. Most lenders require homeowners insurance to obtain a mortgage.

What is the difference between "actual cash value" and "replacement cost"?

Under a homeowners policy, covered losses can be paid on either an actual cash value basis or on a replacement cost value. Under an actual cash value basis, you are entitled to the depreciated value of the damaged property. In other words, the older the property is, the less money you will receive for it. When replacement cost is used, the policyowner is reimbursed the amount it will cost to replace the property at current prices using similar products and quality.

What is the difference between "all risks" and "named perils"?

A named perils policy covers only those perils actually listed in the policy. Typically they include physical losses such as fire, windstorm and hail. An all risks policy covers losses that are due to any peril unless specifically excluded in the policy.

Do I need earthquake insurance?

Damage to your property as the result of an earthquake are not covered under standard homeowners insurance. As most Southeast Missourians realize, we live in an area known to be at risk for earthquakes. Policyholders can add an earthquake endorsement to their homeowners policy which will cover damages from earth movements such as earthquakes and landslides.

What should I consider when purchasing homeowners insurance?

Buy the amount and type of insurance you need. A point to remember: if your policy limit is less than 80% of the replacement cost of your home, you will face a "coinsurance penalty," which means you will have out-of-pocket expenses to cover costs beyond your policy's deductible. For example: if your home's estimated replacement value is $100,000, you would be required to carry at least 80% of the value, or $80,000. If you were to buy a $40,000 policy, you would be underinsured by half. If this were to happen, the insurance company would pay half of a loss, less the policy deductible. For instance, if you were this $40,000 policyholder with a $500 deductible and suffered a $10,000 covered loss, your policy would pay only $4,500.

The Basics of Auto Insurance

What factors influence the cost of auto insurance?

First of all, the kind of car you drive will influence your insurance costs. A high-performance sports car will be more expensive. Other factors that will affect cost include your age, marital status, where you live and how you use your car (business or pleasure).

What factors can reduce auto insurance costs?

Cars that have safety features such as antitheft devices, air bags and anti-lock brakes may have a lower cost. A higher deductible can reduce your premiums. A driver with a safe driving record and no accidents will have a lower cost.

What are some of the coverages available in an auto insurance policy?

Bodily injury liability: In case you cause an accident in which someone else is hurt or killed.
Property damage liability: If you damage someone else's property.
Collision: When your car is damaged as a result of colliding with another car or object.
Comprehensive: If your car is stolen or damaged in ways that don't involve a collision.
Medical payments: Pays the doctor bills, hospital bills or funeral expenses for injuries that occur to you or members of your family that live with you, no matter who caused the accident.
Uninsured motorist: Pays for your injuries when you're hit by a driver who has no insurance.

When do I need to update my policy?

Update your policy when you move, marry, change jobs or no longer insure a young driver.

There are many kinds of insurance that we can provide to protect you and your family. Protection that also includes disability and long-term care. Please contact us for more information or to schedule a visit.
Semo Mutual Fire Insurance Company
18 East Vine Street :: Dexter, Mo 63841
Phone - 573.624.5561 :: Fax - 573.624.5562
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