Review Homeowners Insurance as Part of Severe Weather Preparedness - Part 1

If you own a home, confirm it has the right coverage limit. Homeowners insurance is based on replacement cost. Replacement cost is the amount to rebuild the structure with materials of like kind and quality, without subtracting for age or wear and tear. It is best for the dwelling coverage limit to match the home's replacement cost. Check the co-insurance requirement outlined in your homeowners insurance policy if you insure the house for less than its replacement cost. Underinsuring your home could result in a claim settlement below the cost to rebuild or make repairs.

Owners and renters alike should evaluate personal property insurance needs. A home inventory is the best way to get a handle on this. An inventory is a room-by-room list of belongings and their value. Identify brand names, model information, serial numbers and receipts when possible. Photographs, videos and appraisals are also useful. Use the inventory total to verify how much contents insurance is necessary. Most people invest more in belongings than they realize.

Thoroughly review your insurance policy. An insurance policy is a legal contract hat outlines what is and is not covered. Check coverages, limitations, exclusions and loss settlement provisions. Be familiar with policy terms; identify gaps in coverage; know what to expect when a loss occurs; verify the policy deductible.

Confirm your policy provides adequate insurance before a loss occurs.