More tips about home insurance

admin — Wed, 30 Jul 2008 11:19:05 +0000

Your home insurance will depend on many factors, such as:
Loss of Use: If your home burns down or there is so much smoke damage from a smaller fire that you need to be put up somewhere, this coverage pays for a hotel room, condo, rental house…until you can get back into your home. It also gives some money for the extra cost of eating out. Most companies give you a specific dollar amount for coverage. Others say they will pay whatever that actual cost is. Often companies limit this coverage to one year, and that can be a problem. In many cases, the chances of you getting the old home taken down and a new one built all within a year are small. Be sure to stay on top of the claims and building process. If your company gives you two years of benefits under this coverage, you should be fine.
Medical payments: This is liability coverage designed to take care of people who get injured while at your home. Say a friend comes over and slips on the stairs, requiring stitches. Even if he has medical coverage, he might seek damages to cover the deductible. This coverage will pay for that. Insurance companies would rather pay under this coverage and handle it quickly because it lessens the risk of being sued for more. The limits under this coverage are usually $1,000. This coverage does not cover resident family members or someone working at your home.
Liability: Here we have the same situation as with Auto insurance. Ifou need to have enough so that if sued the person suing will not go after your assets. The umbrella policy discussed in the Auto section could also provide coverage here.
Damage to property of others: This is like a little liability coverage for property damage you or a household family member might cause. A great example is when my nine-year- old son was sure he could hit a golf ball over the neighbor’s house, but only got it as high as the first floor window. Covered!
Back up of sewer and drain: Although this sounds like great coverage to have, it is very limited in what it covers and it usually carries a separate large deductible. It’s easy to understand why really, because only people who think they will need it buy it, right? It might be good to have this coverage but be sure you understand what is covered and what the limits are.

Homeowners insurance tips

admin — Wed, 30 Jul 2008 11:15:30 +0000

Your lender will require you to carry Homeowners insurance, and it makes sense to insure one of your biggest, if not the biggest, physical assets. Coverage is pretty straight forward if you know what to look for.
Building: What if your house burned down? Would your coverage be enough to rebuild it? This is not what the house would sell for, but what it would take to build the same house at today’s prices. Most insurance companies have computer programs that will give a very good estimate on what it takes to rebuild your home but the final decision is always up to you. Insurance companies will usually give you extra coverage, if you insure it for what they think it should be insured for. They do this because building materials and labor can fluctuate (such as after a hurricane) so you need the coverage to expand in case that happens. Your coverage probably contains an inflation rider that will automatically help your insurance keep pace with the rising cost of building or repairing your home.
Other Structures: This will be 10% of your building coverage, unless you pay for it to be more. It covers any buildings on the property that are not attached to the home. If you have put up a nice outbuilding or have more than one unattached structure, you need to confirm that you have enough “other structures” coverage.
Personal Property: Personal property includes your clothes, TV/stereo, furniture, toys, and just about everything that would not be part of the building. How much do you need? Insurance companies automatically give homeowners between 60 and 75% (varies by company) of whatever the building is insured for to cover personal items. Ask if you can have replacement cost coverage. It is a good idea to take pictures of your personal property and keep them off-site. If you have a claim, your first responsibility is to make an inventory of what was lost, and having pictures makes that a lot easier. A video is best, and easiest.

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More tips about home insurance

Homeowners insurance tips