Homeowners insurance is a special type of insurance designed to give protection to homeowners against damages and losses that result from perils like burglary, storms or fire. Legal costs are also covered if a third party gets injured inside your property or home. In an average homeowners insurance policy, flood or earthquake coverage is not part of it; however, this specific coverage can still be added to your policy.
Homeowners insurance is almost required before you can avail for the home loan approval. Before the mortgage enterprise signs off for your loan application, your lender will require you to buy homeowners insurance first. Even if you don’t have your mortgage, it’s still a good idea to purchase homeowners insurance because this is the best way to secure your investment.
Every year, you must review your insurance coverage to see if it meets your specific needs. You can do it through your homeowners insurance provider. Keep in mind that you can include other coverage to your existing insurance policy to increase your level of protection.
Things that cover homeowners insurance
Policies vary on how much and what is particularly covered by your insurance. Depending on your needs, policies can cover a portion or everything of your financial losses. Typically, your coverage can include protection on the following:
- Your home itself, together with the structure and electrical wiring, plumbing, heat system, and central air.
- Your home’s possessions which include appliances, electronics and clothes (even though they are not in your home or property).
- Loss of usage when paying for the hotel accommodation, especially during the time your home is being fixed.
- Personality liability coverage – financial losses if someone gets hurt in your property and puts you to court.
- Payment for the medical needs of those who got injured in your property.
How much coverage do you really need for your insurance?
There are many things to take account when working out for your insurance policy, as well as for the coverage amount needed.
- ”Actual Cash Value” coverage. This coverage pays for the value of your property during the time property is was damaged — less its depreciation.
- ”Replacement Cost” coverage. It doesn’t factor the depreciation and this coverage is more comprehensive than the actual cash value coverage.
- ”Extended Value” coverage. This coverage pays you up to 30% or more of your coverage limit. Therefore, a $150,000 policy can have $195,000 worth of coverage. It’s intended to give protection against things like abrupt hikes in construction costs because of storm damage.
To get the best option, it is advisable to pick the comprehensive option that covers 100% of the cost in rebuilding your home.
The next thing to do in figuring out the coverage you need is to consider your home’s content. Take an inventory of the items you have in house to know how much coverage you should get. Instead of choosing the option for actual cash value, get a more comprehensive coverage to be able to replace all things you own in case of damages.
Be sure that your policy has the sufficient coverage that covers the sum of your financial assets such as your investments, retirement account, home value and others.
It may also require you to have additional insurance policy coverage. Some average policies don’t have coverage that protects the home in case of earthquakes and flood. So if your area or state is prone to these calamities, you can always have extra insurance coverage.
If you have plenty of expensive products in your house like costly artwork and jewelry, personal property provision can be added to your policy. In this case, the insurance company can fully reimburse you of the items damaged, lost or stolen.
To shop for the best and affordable homeowners insurance, getting quotes at least from 5 insurance companies and comparing their amount are important.
To get more information about Homeowners Insurance Coverage in Florida, please contact us at DMG Insurance and Financial Services, Inc. (http://www.dmginsurance.com) at 543 N State Road 7, STE 106, Royal Palm Beach EL, 33411, phone 561 422 7071, Fax 561 422 7072.