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For Residents & Companies of The United States
Copyright
Pending
The most common damage to your home will be caused by natural causes or events that are out of a homeowner's control. Whether the damages are from natural causes such as flooding, high winds, or even theft, there is no way to be sure your home will be spared.
The best thing you can do is to be prepared in the event that a disaster hits your home by purchasing home insurance.
There are many things to consider when purchasing home insurance:
1. Home Insurance is important for everyone to have
- Whether you are a homeowner or a renter, home insurance is a necessity to protect your personal property as well as your home. It is also important to be protected from liability from any accident that may harm others on your property.
2. Research Home Insurance Policies
-You have many options when purchasing your home insurance. A homeowner is able to buy their policy from the company of their choosing, you do not have to select the company recommended by your lender.
Be sure to watch for clauses that refer to an exclusion for an "Act of God" which could be interpreted as a way to avoid paying for damages by the home owners insurance company.
3. How much coverage will need to be provided by your Home Insurance Company?
- The amount you pay for your home insurance will be affected by the amount you want to be covered in case of a disaster. Deciding the amount you will be comfortable paying out of pocket if a disaster occurs will help to decide how much coverage you should invest in. There are some cases where you mortgage lender will tell you how much coverage you will need and require you to purchase at least that amount.
4. Compare different deductibles on Home Insurance
- Choose a deductible, the amount you will pay out of pocket on a claim, that you will be comfortable paying if the time comes when you would experience damage to your home. A policy with a lower deductible will cost more than a policy with a higher deductible. This will be important to keep in mind when looking for a policy through your home owner
insurance company.
5. Know the difference between Replacement Cost and Actual Cash Value
-When comparing home insurance policies you may be able to choose a policy with replacement cost or actual cash value. A policy with replacement cost would cover the amount it would cost to replace, rebuild your home, or repair damages without deducting for depreciation. A policy with actual cash value would cover the amount it would cost to replace, rebuild, or repair damages to your home after depreciation. An important thing to look for is a policy that will cover at least 80% of your home's replacement value.
6. Ask your Home Insurance Agent if there are any discounts available
-In some states home insurance companies will offer discounts for doing things such as insuring your home and car with the same company, replacing your home's roof, or installing deadbolts throughout your home.
7. Be sure to check what your coverage will include
-There are different packages available to protect homeowner's homes and belongings. These plans protect against a specific number of events like, fire, windstorm, and theft, that cause damage to property. These packages also usually contain coverage for the property damage, additional living expenses, personal liability, and medical payments. Many policies do not normally protect against flood damage, but there are supplements available through the Federal government. For more information on this you can go to http://www.floodsmart.gov.
8. Understand your policy
-Read your policy carefully to make sure you understand its contents and be aware that it is a legal contract. Your rights and responsibilities, along with those of your home insurance company, will be clearly stated. When you receive your policy, be sure to keep it in a safe place and know the name of the policy you have bought.
9. Every year reevaluate your Home Insurance needs
-At least once a year check with your home insurance agent to be sure your policy provides adequate coverage. Things such as adding a new room, new insulation. or remodeling will add value to your home and increase your replacement cost.
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