How Your Credit Score Will Influence Home Insurance Rates

There are many things that will affect how much you pay for home insurance. Of these, a credit score can make a big difference in how much you pay.

Much like using your credit to secure a loan or an account with most banks, your score will help insurers determine risks.

For this, they’ll use a “credit-based insurance” score, or CBI.

The Key Difference Between Credit-Based and FICO Score

Although both the CBI and FICO use the same data, the processing is a bit different. Insurers are using most of the data associated with your credit, but not all of it.

Unlike trying to apply for a line of credit, the CBI is essentially used from the perspective of property risks and management.

What Affects your Credit-Based Insurance Score?

Essentially, a lot of the same factors are at play when using a credit-based insurance score as everything else. As I said before, the biggest difference is what data is used when determining your rates.

So, what kind of things will affect your CBI?

Length of Credit History Affects Your Score

The longer you have a history of credit, the better. Unfortunately, this can hinder some of the younger people looking to buy a home and secure insurance.

This is why it’s important to start working on your credit as soon as you’re able.

Credit and Bank Accounts in Good Standing

The number of bank and credit accounts you have in good standing are great benefits toward your CBI and FICO scores. This tells insurers that you’re responsible and can manage your finances well.

In fact, a lot of people will hang on to bank accounts they don’t necessarily use often simply because of how long they’ve had it.

Zero Late Payments and Your Credit Score

Having no late payments on your account is another vastly important factor.

Now, this doesn’t mean that a few late payments here and there will result in an overwhelming poor score. But keep in mind, they will affect your insurance rates.

Overall Credit Usage

How many credit accounts do you have maxed out? The percentage of how much credit you have available for each account will weigh in on your CBI.

Try to pay down your credit as much as possible when applying for new accounts or when looking for new insurance.

Debtor Collection Issuance

Have you had debt collectors call you up in the last seven years? Having a debt collector against your credit score will impact virtually any type of account.

But keep in mind that every agent is different when figuring out your CBI. Having a debtor against your credit may not weigh too heavily, depending on the account.

Recent Multiple “Hard” Hits Affect Credit Score

Having several hard hits on your recent credit history will decrease your score. Mostly, this is because it throws up a red flag to issuers that you run the risk of over-extending your monthly finances.

In other words, don’t apply to every credit card company that comes your way right off the bat. Too many recent inquiries will sink your score quite quickly.

How is Your Credit Score for Insurance Rates?

A poor credit score can make it more difficult to buy properties, but it can also increase your home insurance premiums. At Vargas & Vargas Insurance, we’ll use our network to find the best policies for you. Contact us today to find out how we can help you, even if you have terrible credit.

You may wind up saving more than you thought.

How Much Will Your Location Impact Home Insurance Rates?

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Home insurance is not equal across the board. In fact, there are many, many factors that come into play when figuring your premiums. This includes how rates are affected by the location of the property.

This boils down to how much of a risk factor is associated with your home because of its physical location. And this goes beyond the base an insurer may use for calculations.

What Location Factors Affect Rates?

There are many aspects to consider when pricing out a home insurance policy. Today, we’re just looking at the most common locality issues that will adjust your rates.

While every insurance company is different, these are some of the most used elements for consideration.

State and City Make a Difference

Perhaps one of the biggest location factors for a lot of industries is that of state and city. Your zip code could say an awful lot about everything from insurance rates to groceries.

For instance, what you pay in Boston, Massachusetts, would be significantly different than in Williamstown, Massachusetts, for an identical home. That’s before other factors are even calculated.

Rates can also be adjusted for the location of the neighborhood itself. If your home is in a particularly dangerous area, rates could easily go up. This is because occurrences like vandalism, theft and other crime-related events are more likely to result in claims.

Proximity to Houses and Buildings

How close your home is to any other structure may result in higher insurance rates. This is because there is a greater risk to the property.

For instance, let’s say your home is very close to another. If that other house catches fire, your home is at a much higher risk of joining the blaze. And it’s not just other homes, as your rates may increase if any building is extremely close to your house.

Proximity to Fire Protection Services

In many instances, simply the location of a fire department may affect rates. This includes elements such as whether there is a nearby fire hydrant.

The bottom line is that the longer it takes departments to put out a fire, the more damage that is done. This results in a higher rate of claim, which then translates to higher premiums.

Weather Risks of Locations

Weather will also play a factor in home insurance rates, especially as you’ll have to add extra coverage for specific types of weather events.

For instance, those who live in a tornado-prone area are more likely to face tornadoes, while those closer to the west coast have more concerns about earthquakes. People who live in hail-prone areas that cause damage to vehicles, homes, and other property.

If the location of your home experiences specific weather patterns, you’ll be on the hook for more expensive policies.

As Location Will Affect Your Rates, Keep Discounts in Mind

Where your home is located will directly impact your home insurance premiums. However, there are also many ways you can secure discounts to save you on your annual insurance premium.

At Vargas & Vargas Insurance, we can help you find those discounts while accessing a network of providers to save you the most money possible. Contact us today to find out how we can assist with your insurance needs.

Three ways you’ll benefit from taking out an umbrella insurance policy

Consumers in Dorchester, MA can enjoy many benefits if they purchase umbrella insurance. You can explore the benefits of umbrella insurance by contacting us at Vargas & Vargas Insurance. 

You’ll benefit from taking out an umbrella insurance policy in the following three ways. 

Carrying umbrella insurance makes you less stressed about the future.

Worrying about how a lawsuit down the road could destroy you financially is stressful. Purchasing umbrella insurance is the ideal way to avoid such stress. 

Umbrella insurance provides a safety net and protects your finances from the uncertainties you face in the coming years. 

Umbrella insurance allows you to participate in activities you love without the risk.

Umbrella insurance is particularly recommended for those who participate in certain activities. For example, umbrella insurance coverage is recommended for consumers who use recreational vehicles or coach children’s sporting activities.

Umbrella coverage is also recommended for those who serve on an organization’s board or participate in activities such as hunting.

With umbrella insurance, you can enjoy activities like these that may leave you open to financial risk without adequate coverage. 

Umbrella insurance protects your hard-earned money.

It’s typically recommended that consumers carry enough umbrella insurance to cover the full value of their net worth. That’s because umbrella insurance protects all of the hard-earned money a consumer has saved up throughout their life.

Umbrella insurance protects the funds and assets you have worked hard to accumulate throughout your life. 

Enjoy the benefits of umbrella insurance by purchasing a policy from us at Vargas & Vargas Insurance. We can help secure your financial future in Dorchester, MA. Give us a call to get a quote on an umbrella insurance policy!

How Homeowner’s Insurance Policies Can Be Incredibly Different

Homeowner’s insurance helps to alleviate financial issues in the event of an emergency. However, not all insurance policies are the same across the board. There are a lot of things that are considered when setting up the policy. In fact, it’s quite possible that your premiums will be different from someone who lives across the street.

Even if your neighbors are using the same insurance provider.

Age of the Residence

One of the primary elements that will adjust your premiums is the age and condition of the home. If you have an older structure, there is a good chance you’ll pay more in premiums.

This is partly because of the increased risk involved in outdated materials and repairs. Things like plumbing, wiring, the condition of the foundation, and more can affect how much you’ll pay for your policy.

Perhaps one of the most important aspects is that of the roof. Leaks will easily cause an incredible amount of damage, especially if you don’t catch them in time.

Home Repairs and Costs

Repairs and rebuilds make up a significant portion of many insurance policies. And things like inflation will affect the costs of these repairs.

For instance, if the price of wood goes up, so will your homeowner’s insurance. This is because it becomes more expensive to pay for repairs or rebuilds if the home requires wood, which most will.

Generally speaking, higher-priced homes often have a higher premium due to the cost of repairs. For instance, it’s more expensive to replace French doors to a patio than a regular backdoor.

Preventative Measures and Upgrades

Did you know that installing some preventative measures may actually reduce your insurance policies?

Case in point, some insurers will provide as much as a 10% discount if you have a central station burglar and/or fire alarm installed. This is because these things help reduce the risk of theft and damages, which then saves the insurer money in future claims.

The discounts will vary from one insurer to another. But generally, most offer discounts in some form if you install preventative devices or by updating parts of the home.

For example, if you update your roof or install new electrical and heating systems, your home could go from a “standard” rating to one that is “preferred.” This can save additional money on your premiums.

Working from Home

Since 2020, the prospect of working from home exploded throughout the world. Unfortunately, homeowner’s insurance policies don’t ordinarily cover business expenses or losses.

This means that if you run your business or otherwise work from home, you’ll need additional coverage for anything you use. This could include products, computer equipment, and anything else you’ll need to perform your job.

The additional equipment will easily increase your premiums.

Bundling Insurance Policies

A lot of people will bundle their policies together to reduce the overall cost every month. This is when you have your homeowner’s, automobile, and even life insurance policies from a single provider.

It’s quite a common practice, really. Some providers will offer discounts if you use them for all of your insurance needs. And in many cases, you’d be hard-pressed to find a cheaper alternative by using a separate insurer for everything.

Insurance Policies are Different for Everyone

When it comes to homeowners insurance policies, there isn’t a one-size-fits-all answer. Every home and situation will differ greatly, especially if you decide to include additional coverage for certain valuables, especially if you plan to work from home.

At Vargas & Vargas Insurance, we’ll do our best to find you insurance policies that fit your needs. Contact us today to find out how we can help keep your home, and your property, protected in the event of a catastrophe.

Not all insurance policies are the same, and we can help you secure one that is ideal for your situation.

7 Ways to Protect Your Vehicle During the Winter

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Auto insurance can play a critical role during the winter months. From frozen and slippery roads to white-outs during a snowstorm, you want to have coverage in the event something happens.

However, insurance can only go so far. Your policy isn’t going to cover wear and tear or issues that happen from poor maintenance. While there are several ways you can winterize your car before it snows, what about during the middle of winter?

Let’s take a look at seven ways to help protect your car in the winter aside from proper insurance coverage.

1. Maintain the Battery During Winter Months

The colder months put quite a strain on vehicle batteries. First of all, low temperatures lead to less of an electrochemical reaction within the unit. This means the battery will perform worse during the winter.

It’s vital that you test your battery regularly and replace it before you find yourself stranded somewhere.

2. Keep Timely with Oil and Fluid Changes

Low temperatures cause liquids of all kinds to move slower. This means that any fluids that are dirty, contaminated, or at low levels will hurt the performance of your vehicle more so when it’s freezing outside.

Driving around in the winter while you’re several thousand miles past an oil change increases the strain on the motor.

3. Watch the Radiator and Hoses

Antifreeze is a crucial element for many cars on the road today. And if you’re levels are low or contain more water than actual antifreeze, your radiator and hoses can freeze up.

Frozen lines can lead to splitting, which then results in the engine overheating.

4. Make Sure Belts Are Not Worn

The last thing you want to experience is a belt snapping while driving on the freeway during a snowstorm. Never underestimate how much wear and tear your belts go through on any given day.

Be aware of any kind of fraying or worn-out sections of the belts that keep the motor turning. Just make sure your car isn’t running before you check them.

5. Keep an Eye on the Tire Tread in Winter

Snow, slush, and mud are common road hazards during winter months. You want to make sure your tire tread is apt to take on what nature throws your way.

This is one of the biggest reasons why many people have a separate set of snow tires available for the winter months.

6. Check Your Bulbs and Replace if Needed

Bulbs for your car are usually not that expensive. And depending on the make and model of your vehicle, they are very easy to replace. Make sure your headlights and brake lights are visible to everyone during a storm.

Also, pay close attention to any condensation within the bulb housing. If the bulbs are getting wet, you’ll need to find the leak and seal it before your new bulbs blow out.

7. Use a Car Cover

Car covers, while a bit inconvenient to put on and off in the winter, can save you a lot of trouble. They protect the car from a plethora of weather types. Not to mention some may even alleviate frost buildup on the windshield.

You can find a lot of car covers for less than $100, and they’ll probably save you more than that throughout the year in maintenance expenses. Especially if you spend a lot of money keeping the vehicle clean.

Car covers are a great option if you don’t have a garage.

Winter Months Can Wreak Havoc on Autos

Depending on where you live, the winter months are some of the most strenuous for an automobile. And if you break down on the side of a snowy freeway, it’ll be incredibly strenuous for you.

In the event something does happen, though, you want to make sure you’re properly covered. At Vargas & Vargas Insurance, we’ll help you find the best policies for your auto regardless of the weather. Contact us today to see how we can help you save money while keeping your auto covered during the coldest months of the year.

New Mortgage Guidelines Could Save Money On Your Flood Insurance?

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If you are purchasing (or have purchased) a home in a flood zone, you need to purchase a flood insurance policy. And if your mortgage was an FHA, VA, or USDA loan, and your property is in a flood zone, in the past, you could not purchase your flood insurance from a private flood insurance company. . However, recent changes made to HUD may save you a great deal and may help you qualify for a larger mortgage.

Flood Insurance and FHA-VA and USDA Mortgages

Most standard home insurance policies will provide coverage that will help you with flooding caused by something like a burst pipe, a furnace, or hot water heater that bursts, and the water causes damage to your home. However, this does not include the damages caused by Mother Nature herself.

For example, damages caused by heavy rains, rising rivers, the melting of snow or hurricanes, or other types of flooding caused by a natural disaster aren’t often covered. At least in a standard policy.

Recent conditions from HUD INCREASES FLOOD INSURANCE OPTIONS FOR HOMEOWNERS WITH FHA MORTGAGES LIVING IN SPECIAL FLOOD AREAS.

The upside is that HUD is expanding flood insurance choices for individuals and families with FHA-insured loans. In the past, the National Flood Insurance Program was the only option for FHA-insured mortgages. As of December 21, 2022, however, private insurers are now available as an option.

This is to help keep people protected from high costs while addressing damages caused by climate change.

New Homes and Special Flood Hazard Areas Insurance

According to HUD 4000.1, if any portion of a home is in an SFHA (Special Flood Hazard Area), the home is not eligible for FHA mortgage insurance. This includes proposed or new constructs.

However, there are a few exceptions, such as the lender acquiring a FEMA Letter of Map Amendment or a Letter of Map Revision showing the property is removed from said area.

Another exception is if the lender acquires a FEMA National Flood Insurance Program Elevation Certificate. This is FEMA Form 81-31 and must be prepared by a licensed surveyor or engineer.

What About Existing Structures?

New homes are not the only properties to adhere to flood insurance requirements. Though, the terms for existing properties within an SFHA are often shorter than when building a completely new home.

A property does not qualify for the FHA-insured mortgage if:

  • it is in a Special Flood Zone Area
  • it is located in a coastal area and the National Flood Insurance Program is unavailable.
  • the home is located in SFHA Zone A.
  • it is located in Zone V.

You must maintain flood insurance coverage for the amount remaining on the mortgage or the replacement cost of the home. Whichever is lower is often the amount of the coverage.

Don’t Let Flood Insurance Soak Your Wallet

Flood insurance can be very costly, especially if you’re buying a home in a high-risk zone with an FHA loan. Luckily, private flood insurance may help you get a policy that is less expensive or provide enhanced coverage and allow you to qualify for a larger mortgage.

Thanks to the changes at HUD, you have more options available when choosing a provider.

At Vargas & Vargas Insurance, we may be able to help you save money while being in a Special Flood Hazard Area. Contact us today to see how we can help. We have access to private flood insurance markets that could save you a bundle.

7 Reasons to Buy Your Next Home in the winter

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A lot of people might think spring or summer months are an ideal time for home shopping after all, the weather is usually nice, and you’re more likely to be out and about anyway. For many reasons, buying a home in the winter is far better.

In reality, it could save you a couple of thousand dollars on average compared to other months.

1. Homes are Often Cheaper in the winter

According to data collected by Realtor.com, not everyone’s willing to look at homes in single-digit temperatures. The months of May, June, July, and August make up 40% of existing-home sales, while January and February account for less than 6%.

2. Sellers are Often More Motivated

In many cases, people who are listing homes in the winter are often under time constraints. This could be due to moving before the end of the year for whatever reason.

The end result is a highly motivated seller who wants to close and move on as quickly as possible.

3. Getting an Idea of Future Winters

One of the best reasons to check out a house in the winter is to get a feel for how it’ll hold up for future winters. If there are any problems, you might even be able to get the price reduced so you could repair the property after the sale.

Pay close attention to any drafts, cold spots, leaks, or other issues that are attributed to the colder months.

4. Possible Faster Closings in the winter

Usually, housing markets pick up during the warmer months. This often means that mortgage brokers could get behind in their workload. This results in waiting longer to close on the home.

During the winter, however, the market isn’t nearly as busy. So, mortgage brokers may be able to process your account quicker.

5. Less Competition for Bids

There is a reason why spring and summer months are better for the housing market. Fewer people are willing to move during the coldest months of the year. This means you’ll have less competition when putting in a bid.

The flip side to that, unfortunately, is that not everyone wants to put their home on the market during the winter. This means there are also fewer homes available to choose from.

Still, less competition could save you a bundle when bidding.

6. Possible Tax Benefits

In most areas, you can reap the tax benefits of the entire year of owning a home if you close before December 31st. This could drastically affect your tax returns come April.

Of course, you want to check with your accountant or with the IRS before you can assume to claim the property.

7. A Present to Yourself

Lastly, buying a home in December could be seen as a present to yourself during the holiday season. Moving into a new house is an exhilarating experience that can greatly enhance a positive mental state.

Not to mention throwing housewarming parties for New Year’s eve.

The Winter is Great for Home Buying

In many ways, the winter months are ideal for purchasing a home. Let Vargas & Vargas Insurance help by finding you the best deals to cover your property when it comes time to secure a policy. Contact us today to find out how we can help get you into the new home of your dreams.

What does flood insurance consider to be a flood?

Living in, Massachusetts means that you may need to consider flood insurance. But before you decide to invest in a policy, it’s important to understand what constitutes a flood and how flood insurance can protect your home and possessions. In this post, Vargas & Vargas Insurance looks at some of the key facts about floods and flood insurance.

What is Considered a Flood? 

According to FEMA, flooding is a temporary condition where two or more acres of dry land become wholly or partially submerged in water.

In other words, if water accumulates in an area that would normally be dry, such as your lawn and driveway, it is considered flooding. It doesn’t have to be an overflowing river; even heavy rain that causes puddles on your property can count as flooding.

What Does Flood Insurance Cover? 

Flood insurance covers damage to your home caused by the rising waters associated with flooding. This includes physical damage to the structure itself (walls, floors, roofing), any items contained within the structure (furniture, electronics), and any appliances that are connected to the house (such as HVAC systems). It also covers items outside the structure, like decks and fences. Additionally, it will cover cleanup costs associated with restoring your property after it has been flooded.

Now that you know what constitutes a flood—and what is covered by flood insurance—you can make an informed decision about whether purchasing flood insurance makes sense for you and your family. To find out more information about getting coverage in Dorchester, MA, contact Vargas & Vargas Insurance today! We’ll help you get the right policy for your needs so you can rest easy knowing that your home is protected against floods!

Insurance Coverage: Are Maintenance Costs Covered?

Taking care of your property is nothing short of improving your investment. And although homeowner’s insurance can help recover in some cases, it doesn’t cover a lot of maintenance costs.

This is especially true if damages are the direct result of being neglectful. These are just some of the costs that might come out of your pocket.

Termites and Other Insects

Although you may find your home tranquil, there are a lot of insects that might find it tasty. Termites and other insects can quickly turn your home into a sanctuary.

In some instances, insurance policies do not cover the damages created by these bugs, including pest control or home-cleaning services.

This often includes insects such as termites, cockroaches, ants, spiders, and a whole host of pests that tend to invade your privacy. If you see any of these bugs on your property, there’s a good chance they’re also in your home.

Bird, Rodent, and Animal Damage

Another of the most common damages from nature comes in the form of birds and rodents just looking for a place to live. Unfortunately, they will tear apart your home from the inside.

In fact, a lot of people don’t even know there is a critter problem until something like a leaky ceiling or various smells start emanating from the walls.

It’s not just the little ones that can wreak havoc, either. Raccoons are well-known for utilizing roofing materials for both houses and garages to create nests.

Rust, Rot, and Mold

A small leak in your roof created during the winter can lead to costly repairs in the summer. Rust, rot, and mold are common results of neglecting the property. And not all insurance policies will cover the repairs.

For example, let’s say that you neglected to notice that leak in the roof. Over time, the water invading your home can lead to rotting out the drywall as well as propagating mold within the walls.

In this case, your insurance coverage might not cover the maintenance costs and repairs that will accumulate.

General Wear and Tear

Perhaps one of the most obvious elements of being a homeowner is repairing the general wear and tear of the property. This can include everything from replacing an old carpet to buying a new air conditioning unit.

While insurance coverage might not reimburse you for most of these expenses, you might still qualify for discounts. That is if you upgrade the home with preventive appliances, such as fire alarms or anti-theft devices.

To find out more about what discounts you qualify for as a homeowner, be sure to contact your policyholder.

Your Insurance Policy Might Not Cover Maintenance Costs

Although every insurer is different, many won’t cover repairs and other costs related to the upkeep of your home. Instead, those expenses will come out of your pocket.

This is why it’s vital to perform routine maintenance on your property. Even the slightest leaky pipe under the sink can lead to severe and costly water damage.

Preventative maintenance is crucial for keeping your home safe and secure.

At Vargas & Vargas Insurance, we strive to help people understand their policies while finding the best deals for their needs. Contact us today to find out how we can help you keep your home protected.

Always remember, an ounce of prevention is worth a pound of the cure.

Insurance Coverage: What Happens During a Flood?

Your home insurance policy doesn’t provide a blanket of protection from everything. For example, you might not have coverage if a flood causes water damage to your property. But that also depends on the type of flood and what was damaged.

Today, let’s take a quick look at flooding and what you can do to protect yourself.

What kind of Flooding Isn’t Often Covered?

Although home insurance can help with some costs caused by flooding, there are quite a few that may not be in your policy. This may include:

  • Natural disasters, such as extreme rain or snow.
  • External sewage line breaks or backups.
  • Sump pump flooding.

However, your policy might include coverage in the event of damages from broken pipes inside the home, flooding from a bad water heater, or if a fire was the result of various types of water damage.

Generally speaking, a “flood” is considered any excess water on the property that is normally dry. If a sewage backup is caused by flooding, and you have a sewer backup endorsement on your policy, that is covered by insurance.

Of course, you review your policy with your local independent insurance agent or review your policy.

What Affects Flood Coverage Policy Costs?

Like any other type of insurance, the costs of flood coverage depend on a wide range of factors. This is why people will often pay different premiums even though they live in the same city.

Some of them include:

Risk of Flooding
If your home is in a location that is prone to floods, your policy could increase.

Your Deductible
A higher deductible of the coverage will reduce your monthly premiums.

Property Location
The neighborhood of your home could affect the cost aside from the flood risk.

Age of the Property
As older homes are more prone to needing repairs, their age could increase the cost of a flood policy.

Itemized Schedules
Not everything is covered in the home through flood insurance. Valuables such as jewelry and antiques may need to be scheduled separately.

How to Get Coverage in Case of a Flood

If flooding is a concern, you need to contact your insurance agent to buy a new policy. You can also renew an existing policy to include flood coverage.

The average premium in the United States is around $750. But this can be higher or lower depending on where you live. This is especially true if you live in a location that is prone to some kind of flooding.

At its average cost, flood coverage is only an extra $62.50 per month. Considering the sheer amount of damage water can do to a home, this is not that bad of an expense to protect your family and property.

Water Damage Can Be Devastating

The important thing is to have the flooding repaired immediately. Even the slightest trickle within the walls can result in mold growth, extreme drywall damage, and compromise the framework of your home.

At Vargas & Vargas Insurance, we can help ensure that your policy includes covering floods and other types of water damage. If this is a concern for you, contact us today to see how we can help.

You don’t have to face water damage and flooding on your own if you have proper coverage.