ATLANTA--(BUSINESS WIRE)--Home Value Protection, the only insurance policy in the U.S. that protects homeowners from the devastating impact of declining home prices, rolls out in Georgia this week. Home Value Protection insures the market value of a home, effectively sheltering homeowners’ equity from the plunge in housing prices that has plagued the state and much of the US since mid-2006. It is the only insurance policy that allows homeowners to protect the investment in their home—the largest financial asset of most families—from housing market cycles.
Georgia is the third state in the nation where this groundbreaking insurance policy for owner-occupied, primary residences is being offered by Home Value Insurance Company, a licensed insurance carrier regulated by the Georgia Department of Insurance.
“In Atlanta, the state’s largest housing market, hard-hit homeowners have seen year-over-year home price declines of 12.8 percent, according to the most recent S&P/Case-Shiller® Home Prices Indices,” said Scott Ryles, CEO of Home Value Insurance Company. “This translates into a $24,766 average loss in home value.”
“Historically, homeowners counted on their equity growing, and with it, their financial well-being. But the housing market has wreaked havoc on the finances of the typical homeowner. They’ve been unable to count on their home equity to help fund future financial needs, whether it’s the purchase of another home, or as a savings source for retirement,” said Ryles.
According to the latest S&P/Case-Shiller® data released Feb. 28, local home values in Atlanta tumbled throughout the fourth quarter of 2011, dropping 1.8 percent in December, 2.5 percent in November and 5 percent in October.
“While many industry experts believed the market had bottomed, new data has shown otherwise,” noted Ryles. “With the availability of Home Value Protection, homeowners can take control of the market value of their home and stop worrying about the loss of home equity or the prospect of an underwater mortgage. For a dollar or two a day, they have an antidote to an uncertain housing market. And they can still realize the upside when home values appreciate.”
The company introduced Home Value Protection in Ohio last year, and expanded into Oklahoma in February prior to launching in Georgia. Home Value Insurance Company is proceeding with US expansion plans as it seeks to address demand from homeowners and prospective home buyers.
Ryles said that this unique insurance is already protecting policyholders in hard-hit Ohio communities that experienced declines in home values of $1600 on average in the third quarter of 2011. “Home Value Protection insurance is restoring consumer confidence in local housing markets,” said Ryles.
“Homeowners have long been able to buy insurance to protect against events like fires and floods. Yet, homeowners are more than twice as likely in any given year to suffer from a decline in home prices than they are to experience the typical hazards a homeowner’s policy covers, such as flood, fire or burglary,” Ryles explained.
“Having to sell when home values are down can be just as devastating financially to homeowners as a fire, and now there is a way for homeowners to protect against that risk,” Ryles added.
“Many times a life event, such as a job transfer, divorce or growing family dictates the need to sell. A weak housing market is often coupled with poor economic conditions that can result in job loss and the need to relocate to find work. With Home Value Protection, homeowners have the flexibility to sell their home, even in a down market,” said Ryles.
Here is how Home Value Protection insurance protects homeowners. A home is insured based on the current market value. If local home prices decline and a policyholder sells their home for less than the insured value, their policy protects against the loss. Homeowners can lock in their insured home value for up to 10 years, providing them ongoing protection from an uncertain housing market. If home values appreciate, a homeowner can purchase a new policy with a higher insured home value.
Home Value Protection insurance protects homeowners at all stages of life:
- Homebuyers - Home Value Protection allows homebuyers to lock in their purchase price and insure their down payment from the risk of declining home values. As homebuyers pay down their mortgage, Home Value Protection protects the initial down payment, as well as the growing equity they are building in their home.
- Existing homeowners - Home Value Protection insurance safeguards the financial well-being of existing homeowners by protecting the savings they have invested in their home. When housing values drop, home equity is substantially diminished, and can disappear altogether. This, coupled with the need to sell, can create a financial crisis for homeowners.
- Near retirees - Those nearing retirement can protect the portion of their net worth invested in their home, which can be an integral part of their retirement and estate plans.
For a typical Georgia home, monthly premiums are from $25 to $35 a month. To track housing values, Home Value Protection insurance uses the Case-Shiller® Home Price Index, a leading industry measure that tracks local housing market performance.
Home Value Protection insurance is available from independent insurance agents in Georgia, directly through the company’s website, HomeValueProtection.com, or by calling 1-866-576-0611. The company is building a network of more than 200 independent insurance agencies across the state, who will be appointed to sell Home Value Protection insurance.
About Home Value Insurance Company
Home Value Protection insurance is a property and casualty insurance policy underwritten and offered by the Home Value Insurance Company. The Home Value Insurance Company is a licensed, admitted carrier in Georgia, regulated by the Georgia Department of Insurance, and is a wholly owned subsidiary of Home Value Protection, Inc. Home Value Protection insurance is not sponsored, endorsed, sold or promoted by Standard & Poor’s, Fiserv, or any of their affiliates, and they make no representation regarding the advisability of purchasing Home Value Protection insurance. Standard & Poor’s®, S&P®, Fiserv®, Case-Shiller®, and related trademarks used with permission.