If you're like most people your home is most likely the most important investment you'll make in your lifetime. In the event of an unexpected disaster it is crucial to your financial well being to make sure you have enough coverage. Let's take a look at some of the things you should be aware of when purchasing homeowners insurance.
Most policies cover four areas
The structure of the home
Personal property
Liability coverage
Loss of use expenses
Structure of Your Home
If your home is damaged or destroyed by one of the disasters named in your policy you should have enough insurance to rebuild. Other Structures that are typically covered include: garages, storage sheds, and fixtures attached to the land including fences, driveways, sidewalks, patios, and retaining walls.
Personal property
Personal property protection can be based on actual cash value or replacement cost and covers the contents of your home and other personal items owned by you or family members. Taking pictures or video of you valuables is a way to provide proof of ownership in the event of a claim. Many policies include off-premise coverage, which means your possessions are covered any where in the world.
Liability
In the event someone gets hurt on your property liability coverage protects you against law suits. It pays for your defense in court and any money you are required to pay, up to your policy limit. It also includes no fault medical coverage if someone is injured in your home.
Loss of use expenses
Loss of Use typically covers living expenses over and above your normal living expenses if you are forced out of your home during repairs of damages caused by one of the covered disasters, a standard policy will pay for your hotel stay, restaurant bills, etc.
Two types of coverage are replacement cost coverage and actual cash value
An actual cash value policy pays to rebuild your home, minus depreciation. A replacement cost policy pays to replace your home and possessions without a deduction. The highest level of protection is guaranteed replacement cost coverage.. Choosing the right coverage is extremely important. I suggest a guaranteed replacement cost policy. With this type of coverage the total cost to replace your home will be paid, even if it is higher than your policy limit.
Take time to consider the above mentioned ares when shopping for homeowners insurance. Do some research online and compare quotes from different insurer's. Narrow your quotes down to two or three, and then contact the agents with any questions you have. Spending time comparing quotes is worthwhile and can save you a significant amount of money.
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