Homeowners Insurance - Dwelling Limit
Homeowners insurance is based on replacement cost, which is how much it takes to rebuild the house using materials of like kind and quality without subtracting for age or wear and tear. A room addition, new deck or kitchen upgrade will likely increase the replacement cost of your home. Insuring the dwelling below its replacement cost may result in a claim settlement less than the amount to repair damage or rebuild the home. Ask a local agent for help determining your home's replacement cost. Be familiar with your home's replacement cost and increase your dwelling coverage limit accordingly.
Homeowners Insurance - Personal Property Limit
Most people own more belongings than they realize. A contents inventory is a good way to evaluate your personal property insurance needs. Create a room-by-room record of belongings. Identify values and include brand names, model information, serial numbers and receipts whenever possible. Photographs, videos and value appraisals are also useful. Total the personal property inventory and increase your contents coverage limit if necessary. Keep in mind that insurance policies make coverage distinctions when it comes to personal belongings and business-related property that may be in your home. Store the personal property inventory in a safe deposit box or other fireproof, waterproof secure location. Update it periodically.
Homeowners Insurance - Coverage Details
Homeowners insurance is a package policy that covers sudden and unexpected property loss and personal liability risk. Policies typically exclude certain losses that are widespread, catastrophic or maintenance-related. Review policy exclusions and limitations. Look for caps that restrict claim settlements on belongings like jewelry, furs, coins, computers, antiques, artwork and business property. Identify and discuss coverage gaps with your insurance agent. Most homeowners insurance policies provide replacement cost coverage for dwelling losses and actual cash value coverage for personal property claims. Consider adding contents replacement cost coverage. Insurers typically offer numerous buy-back endorsements that allow policyholders to expand coverage. Earthquake, sewer/sump pump back-up and a personal property floater are among these. Flood damage is excluded, but insurance is often available a stand-alone, single-peril policy. A local agent can provide cost and coverage details on additional insurance options.
Homeowners Insurance - Liability
Homeowners insurance policies often provide $100,000 in personal liability protection. Request higher limits if this does not align with your financial assets.