 Insurance Most people do not think
about homeowners Insurance until they experience a loss. Homeowners
insurance can protect you from significant financial loss from liability and property damage. Remember, your home is probably your largest investment. Most lenders require that you have homeowners insurance in
place in order to protect their interest.
Buying Homeowners Insurance Away from your home and whether or not you were at fault. Additional living expenses coverage will pay for your living expenses when you cannot live in your home because of damage that is covered by your policy. Homeowners will provide coverage for the contents of your home, other structures on the property and sometimes landscaping. Types of coverage The homeowners insurance packages most commonly offered are:
Buying the correct amount of coverage you need to purchase enough homeowners insurance to protect the structure and your personal possessions in the event of a loss. First, Determine replacement cost. You can hire an appraiser to estimate how much it would cost to rebuild. You can also ask your insurance agent. Most agents have replacement cost estimates. If you have a claim If you are the victim of a theft, accident or damage to home or property:
Actual Cash Value: Actual cash value is the amount it would take to repair or replace the structure minus depreciation due to age and normal wear A home owner's policy insures personal property on an actual cash value basis. Limits are normally 50 percent of the policy limit of the structure value. The policy provides limited coverage for personal property if it is stolen or damaged away from home or while you are on vacation. Coverage is limited to very small amounts for property that is especially susceptible to loss, such as cash, jewelry, furs, manuscripts and stamp or coin collections. Additional coverage for these kinds of items can be purchased with a personal property endorsement. Update your home inventory Keep an itemized, updated list of personal belongings and home furnishings, including costs, purchase dates and serial numbers. You can simply list items on sheets of paper, or use household inventory computer software. Such programs are included as part of many home finance software packages; others can be downloaded from the Internet free of charge. Keep receipts for big-ticket items along with your inventory records. Your insurance company may require proof of the cost of an item for which you make a claim. It is an excellent idea to make photographs or videotapes of your possessions along with the itemized inventory. Having a well-documented inventory will help you get an accurate settlement or tax deduction for your losses. Store these and other important insurance papers in a safety deposit box. Kepp accessable names of your agent and policy number. Keeping your coverage current It is important to undertake an annual review of your home owner's insurance coverage to be certain that it is adequate. Some considerations include inflation, which increases the value of your home, any improvements that you make to your home, or additional significant personal possessions that you may acquire. Some companies offer inflation guard endorsements that cause your structure value limits to increase automatically for inflation in order to maintain 80 percent of replacement cost. The most complete coverage for your home is provided by the replacement cost guarantee endorsement. It provides coverage equal to 100 percent of replacement cost. Deductibles If you elect to purchase a policy with a larger deductible amount, your annual premium will be less, but you will have to pay more out of your own pocket each time a loss occurs. If you choose a smaller deductible, your premium will be significantly higher. Shopping for homeowners insurance When shopping for home insurance, premium quotations are a useful tool to compare different companies rates. Remember, competition only works if the consumer shops for coverage. To get accurate quotes:
The coverage's and limits that you want. Price should not be the only criteria. You also should consider each company's reputation for financial stability, policyholder service, as well as underwriting and claims handling practices. Flood insurance Standard homeowners insurance does not provide coverage for damage due to floods. Depending on your home's location, you may qualify for flood insurance. If your home is located in a flood plain, your lender should require flood insurance. But, just because your home is not in a designated flood plain, don't assume you will never incur flood damage. Federal flood insurance is sold through the National Flood Insurance Program (NFIP) by insurance agents. To obtain coverage, contact your agent, or, if you do not have an agent, call the NFIP at 1-888-FLOOD29.
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