If you are like most people in America, your house is your largest asset. More money is spent on paying for a house than is spent on just about anything else. The average home in America is worth almost $200,000. Across the country, when a home is purchased with a loan, the lender requires home insurance on the home. This is to protect the bank but it is also to protect you as the home owner.
However, the main thing that people look for when selecting their home insurance is to figure out where they can get it cheapest. Most people have no idea what home insurance covers and they don’t consider the benefits of one policy over the other. Fortunately, most insurance policies have fairly standard coverage. But many home owners find themselves sorely disappointed when it comes to making a claim. What is covered with a standard home insurance policy?
1. It covers the structure of your home.
Your home insurance policy will pay to repair or rebuild the house should an event like a fire, wind or hailstorm cause damage. Pay extra attention to the coverage amount listed. If it costs $300,000 to rebuild your home and you only have $200,000 worth of coverage you will either have to come up with the difference yourself or you will have to build a cheaper house. Also pay attention to what kind of disasters it will cover (earthquakes, floods, hurricanes, etc.)
2. It covers your personal belongings.
There are two main types of coverage regarding personal belongings. Personal belongings refers to all the “stuff” that you own. You can have “actual cash value” coverage or “replacement cost” coverage. Actual cash value is generally the type of coverage you have on your auto insurance. The insurance payout will be on what the value of the items were at time of loss. To get an idea of what that coverage would be ask yourself the question “what could I get for my stuff at a garage sale or if sold online.” Replacement cost coverage will pay to replace your stuff for what it would cost to buy new.
3. It provides temporary living expenses if your house becomes uninhabitable due to a covered loss.
If, for example, a tree falls on your home and makes in so that you cannot live there until the necessary repairs are made, your home insurance will cover a certain number of days worth of living expenses (primarily food and housing in a hotel).
4. It provides liability protection.
This coverage is to help protect your assets in the event of somebody coming after you financially. An example would be someone slipping and falling on your steps and then hiring a lawyer to sue you. Talk to your insurance agent about how much liability protection you should have. Generally speaking, the more assets you own, the more liability protection you should have.
Having the appropriate amount of home insurance coverage is vital if you want to protect yourself, your loved ones and your property. Maybe you have an RV instead? Visit motor home insurance by Williams for more information. If you live in the Marion, IL area and have any questions or would like an insurance assessment, please contact our office. We would love to help you.Learn More