• Kelly Ann

What You Should Know About Your Home Insurance


 


 

Don’t just sign on the dotted line. When it comes to homeowner’s insurance, you really should know what you’re signing up for. Too often, homeowners get bad news while filing an insurance claim simply because they didn’t take more time to know what their insurance policy actually covers. We are sharing the 3 major areas that often get overlooked when it comes to insuring your home.

 


Policy Terms


  • It is very important for policy owners to check whether they have a recoverable or non-recoverable insurance policy. Not planning ahead in accordance with your plan may leave you with costs you are not prepared for or comfortable covering.

  • With a non-recoverable plan, you will pay more out-of-pocket than just your deductible costs. Your costs will include your policy’s deductible PLUS any depreciation amount for full replacement.

  • With a recoverable plan, you will pay your deductible, then receive the actual cash value (ACV) on your claim PLUS the depreciation amount. It’s important to note that some recoverable plans may become non-recoverable if certain conditions like repairs or replacements are not made.


Deductible


  • A deductible is the amount of money you will pay out-of-pocket toward damages or a loss before your insurance company will pay for a claim. A premium is the amount you pay for an insurance policy (typically monthly) to keep it active.

  • Deductibles are typically dollar or percentage amounts. The amount you choose is locked in with the terms of your coverage when purchased. Your deductible can typically be found on the front page or declarations page of your insurance policy.

  • In the event you must file an insurance claim, you will be responsible for the deductible. You want to be financially prepared and informed to ensure it is an amount you are comfortable with. Remember, there are several options out there and talking to your insurance agent may help you feel more secure in your coverage. Agents can run quotes with various deductibles to help determine what is the best value for you.


Coverage


  • One of the biggest mistakes most homeowners make is not having adequate insurance for their property. It is imperative that you know what your policy does and does not cover. Most basic policies have limits, so you may need to purchase additional policies to have the coverage you need.

  • Pay attention to things left out of coverage limits, or whether you will be reimbursed purchase price or depreciated value for your home and overall property items.

  • Know the value of the items in your home. Taking a home inventory can help you identify what kind of insurance you will need to cover valuables should they become lost or stolen. It will also help you decide if you need extra coverage for larger ticket items such as jewelry, art, or heirlooms.

  • Most insurance policies do not cover wind, hail, earthquake, or flood damage. If you live in a high-risk area, you may need extra coverage. The government also has programs that can help in these situations.

  • Other reasons you may want extra coverage are, mold, sewage systems, and other plumbing or drain systems. Protection of your possessions is another often overlooked area. Your standard policy may be limited so extra coverage for anything of personal value or worth may be worth adding.

 

Don’t wait until it’s too late to find out your insurance really doesn’t have your back. That can be a hard lesson to bear. Get to know your insurance now and make any needed changes quickly so that when disaster strikes, you’ll be covered in the best possible way.





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