Before You Start House Hunting, Begin Searching For Homeowners Insurance

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National Association of Realtors President Cathy Whatley said earlier this year that homeowners insurance premiums and the lack of available coverage have become significant barriers to homeownership. Most affected are those who have no credit history and existing homeowners who have water-related claims.

"In light of today's insurance crisis, homebuyers should not take their insurability for granted," she said. The Insurance Information Institute says the average cost of homeowners insurance increased by 8 percent last year and is expected to rise another 9 percent this year. But many homeowners have seen increases ranging from 30 to 70 percent.

Catastrophes like Hurricane Andrew and the Northridge Earthquake have triggered the increases, the industry says. Over the past 12 years insurers paid out more than $100 billion in catastrophe related losses -- about $700 million per month -- many times more than in previous decades. Another contributor is mold. Multi-million dollar jury awards, what the industry describes as sensationalized reporting in the media and profiteering by some individuals have led to an explosion in mold claims and costs, the III says.

In an effort to aid homebuyers, the III recently produced a checklist for potential homeowners to follow when looking for insurance. You should begin, the industry group says, by making sure your credit report is accurate -- credit histories are sometimes used to determine whether a company will insure you, and, if so, at what rate.

You should get a copy of your loss history report, such as a CLUE report from ChoicePoint or an A-PLUS report from Insurance Services Office. This is a record of home insurance claims you have filed. If you have not filed any insurance claims in the past five years, you won't have a loss history report. The better your report, the better chance you'll have of obtaining reasonably-priced insurance on the house you buy.

And if you're renting, make sure you have renter's insurance -- it's helpful to have insurance history when you obtain insurance for your new house.

Once you start looking for houses, the III says there are a number of factors that will affect your insurance rates, including:

• The construction of the house. If you live in hurricane country, brick is preferable. If you're in an earthquake region, newer homes built to current codes will better withstand an earthquake.

• The age of the house. Plaster walls, ceiling molding, wood floors, and other features on older houses cost more to replace.

• Its condition. If you have a fixer-upper in mind, you may have to shell out more for insurance. The condition of the roof is especially important.

• The major systems. The plumbing, heating and electrical systems can wear out, becoming more susceptible to fire or water damage.

• Safety devices. Some insurance companies offer a discount for smoke, fire, and burglar alarms, as well as strong doors, dead-bolt locks and window locks.

• Extra features like swimming pools and wood-burning stoves will raise your premium.

• The location of the local fire department. The closer you are to a fire station with a professional -- versus volunteer -- crew, the better.

Also, a professional inspection will uncover anything that will raise a red flag for insurance companies, such as water damage or termites and the condition of the electrical system, septic tank and water heater.

Once you start bidding you should find an insurance professional. Get references from family and friends. Shop around for the best coverage and the best rates.

After you've bought your house and have secured insurance, the III recommends you take the highest deductible you can afford.