Homeowners InsuranceJump to request quote form.What is in a standard homeowners insurance policy? How does my homeowners insurance policy protect me? What's the best way to protect my home?For 99% of home buyers, buying a home is the single largest purchase they will make in their entire lives so asking these questions makes sense. Since each situation is unique, the information presented here is intended to give you a foundation upon which to build your understanding. As you read, make a note of any specific items that relate to you and be sure and ask your agent for details. A standard homeowners insurance policy includes four essential types of coverage. They include:
1. The structure of your home This part of your policy pays to repair or rebuild your home if it is damaged or destroyed by fire, hurricane, hail, lightning or other disaster listed in your policy. It will not pay for damage caused by a flood, earthquake or routine wear and tear. When purchasing coverage for the structure of your home, it is important to buy enough to rebuild your home. Not widely known to many homeowners is that when property prices go down, the cost of replacing the structure goes up, creating a need for greater replacement cost coverage. Another detail often overlooked here is changes to local codes that may affect the current cost to replace. Ask your agent for details. Most standard policies also cover structures that are detached from your home such as a garage, tool shed or gazebo. Generally, these structures are covered for about 10% of the amount of insurance you have on the structure of your home. If you need more coverage, talk to your insurance agent about purchasing more insurance. 2. Your personal belongings Your furniture, clothes, sports equipment and other personal items are covered if they are stolen or destroyed by fire, hurricane or other covered perils. Most companies provide coverage for 50% to 70% of the amount of insurance you have on the structure of your home. So if you have $100,000 worth of insurance on the structure of your home, you would have between $50,000 to $70,000 worth of coverage for your belongings. The best way to determine if this is enough coverage is to conduct a home inventory. We recommend you make a digital recording of the contents of your home twice a year (when you are testing your smoke detectors!). This part of your policy includes off-premises coverage. This means that your belongings are covered anywhere in the world, unless you have decided against off-premises coverage. Some companies limit the amount to 10% of the amount of insurance you have for your possessions. You have up to $500 of coverage for unauthorized use of your credit cards. Expensive items like jewelry, furs and silverware are covered, but there are usually dollar limits if they are stolen. Generally, you are covered for between $1,000 to $2,000 for all of your jewelry and furs. To insure these items to their full value, purchase a special personal property endorsement or floater and insure the item for it's appraised value. Coverage includes "accidental disappearance," meaning coverage if you simply lose that item. Trees, plants and shrubs are also covered under standard homeowners insurance. Generally you are covered for 5% of the insurance on the house-up to about $500 per item. Perils covered are theft, fire, lightning, explosion, vandalism, riot and even falling aircraft. They are not covered for damage by wind or disease. 3. Liability protection Liability covers you against lawsuits for bodily injury or property damage that you or family members cause to other people. It also pays for damage caused by your pets. So, if your son, daughter or dog accidentally ruins your neighbor's expensive rug, you are covered. However, if they destroy your rug, you are not covered. The liability portion of your policy pays for both the cost of defending you in court and any court awards-up to the limit of your policy. You are also covered not just in your home, but anywhere in the world. Liability limits generally start at about $100,000. However, experts recommend that you purchase at least $300,000 worth of protection. Some people feel more comfortable with even more coverage. You can purchase an umbrella or excess liability policy which provides broader coverage, including claims against you for libel and slander, as well as higher liability limits. Generally, umbrella policies cost between $200 to $350 for $1 million of additional liability protection. Your policy also provides no-fault medical coverage. In the event a friend or neighbor is injured in your home, he or she can simply submit medical bills to your insurance company. This way, expenses are paid without a liability claim being filed against you. You can generally get $1,000 to $5,000 worth of this coverage. It does not, however, pay the medical bills for your family or your pet. 4. Additional living expenses This pays the additional costs of living away from home if you can't live there due to damage from a fire, storm or other covered perils. Coverage for additional living expenses differs from company to company. Many policies provide coverage for about 20% of the insurance on your house. You can increase this coverage, however, for an additional premium. Some companies sell a policy that provides an unlimited amount of loss-of-use coverage, but for a limited amount of time. Call us today or use the form below for a no obligation review of your current policy or what coverage you may need for a new one! 562 630 4163.Required fields marked with  . |
