For any homeowner, it is important to know about homeowner’s insurance. Home insurance is necessary to protect the home itself, any personal property owned as well as another very important reason to obtain coverage… personal liability. Listed below are a few key points to consider when purchasing a homeowner’s policy:
1. How much coverage should I obtain on my home?
– There are basically 2 ways in which a home policy can be written. Actual cash value and Replacement cost. Often, the policy should be written on a Replacement cost basis. This means in the event of a covered loss; the home would be re-built with current labor and material costs. The payout would not be depreciated based on the age of the structure. This is highly recommended and often required by the insuring company in their preferred homeowner’s programs. Actual cash value coverage means a claim payout for a covered loss would be paid on a depreciated basis, leaving the insured with high out-of-pocket costs above the policy deductible. An actual cash value policy is rarely suggested for a homeowner.
– The deductible is the out-of-pocket portion you would have to pay in the event of a claim. There are many options to choose from when it comes to the policy deductible. The deductible can range anywhere from $250 to $10,000 depending on the type of policy written. It generally a good idea to choose a deductible that would be affordable if a claim should arise. Although, there are instances in which the deductible amount is pre-determined by the insurance company. A discussion with your agent is the best way to determine what is right for you.
3. Additions/updates to home:
– It is a good idea to let your agent know of any changes to your home, no matter how small they seem. For example, let your agent know right away if you add a room addition, deck, or any other type of structure to your home. Or, if you build a shed, barn or detached garage on your property. It is also very important to let your agent know if you get a new family pet…. As some types of pets could affect your liability coverage.
4. Find the best agent:
– Shopping around for the best rate is a smart thing to do, but finding the best agent can be just as important. As with many professions in this world, there are many agencies and insurance companies to choose from. Recommendations from family and friends are a good way to find an agent that may be well suited to fit your situation. When cost is an important factor while choosing an insurance agency/company, customer service should also be a large part of your decision-making process. If one company can offer better customer service, but may be a little higher in price, give them a chance. It usually ends up a better deal in the long run. Contact us for more information.