Life is unpredictable. The evening news is proof of that. There are fires, floods, earthquakes, and hurricanes, and that's on a slow day.Home insurance helps people protect their largest, most substantial investment. In this article, we will discuss the most important things to consider when shopping for home insurance.
While plans invariably vary from insurer to insurer, most of them have four main components:
1. Coverage for the home or structure
As you might imagine, this is the single most important aspect of any standard home insurance policy. It protects the home against damage from storms, fires, and other natural disasters. At the very least, you should insure your home for one hundred percent of its value. This is the amount it would cost for the home to be completely rebuilt. This might seem like overkill.After all, homes are seldom completely destroyed when they are damaged. Still, it is better to be safe than sorry.
2. Coverage for Contents
Most standard policies will cover the cost of your personal belongs if they are damaged in a natural disaster. They may also pay if your personal effects are lost or stolen. The average coverage for contents is equal to fifty percent of the value of your home. So, if your home is worth four hundred thousand dollars and it burns to the ground, the insurance company will pay you two hundred thousand dollars just for the contents.
3. Liability Protection
Most people are unaware of the fact that home insurance also covers damage to other people's property. For example, if you daughter accidentally throws a football through your neighbor's expensive bay window, your insurance provider will probably pay for it. This is called liability protection and it generally covers damage to property, medical expenses for injuries, and court costs. Most insurance providers recommend at least $100,000 of liability insurance for a comprehensive policy.
4. Reimbursement for Additional Living Expenses
This aspect of the insurance policy only comes into play if your home is damaged to the point where it is deemed unlivable. If the policy holder is forced to find a pied-a-terre, his insurance company will pay for his living expenses while his home is being repaired or rebuilt. This coverage generally includes the cost of rent or hotel bills, food, and even rental car fees. The standard policy provides additional living expenses that are equal to around twenty percent of the value of coverage on the home. So, if you have four hundred thousand dollars of coverage, your family will receive around eighty thousand dollars for living expenses.
Now, that may seem like a lot of money... but trust us, it goes fast. Hotel bills add up in no time and it can take well over a year to rebuild a home that has been ravaged by a flood or fire, which is why it is important to make sure you have enough coverage for each of the components we discussed today.
While plans invariably vary from insurer to insurer, most of them have four main components:
1. Coverage for the home or structure
As you might imagine, this is the single most important aspect of any standard home insurance policy. It protects the home against damage from storms, fires, and other natural disasters. At the very least, you should insure your home for one hundred percent of its value. This is the amount it would cost for the home to be completely rebuilt. This might seem like overkill.After all, homes are seldom completely destroyed when they are damaged. Still, it is better to be safe than sorry.
2. Coverage for Contents
Most standard policies will cover the cost of your personal belongs if they are damaged in a natural disaster. They may also pay if your personal effects are lost or stolen. The average coverage for contents is equal to fifty percent of the value of your home. So, if your home is worth four hundred thousand dollars and it burns to the ground, the insurance company will pay you two hundred thousand dollars just for the contents.
3. Liability Protection
Most people are unaware of the fact that home insurance also covers damage to other people's property. For example, if you daughter accidentally throws a football through your neighbor's expensive bay window, your insurance provider will probably pay for it. This is called liability protection and it generally covers damage to property, medical expenses for injuries, and court costs. Most insurance providers recommend at least $100,000 of liability insurance for a comprehensive policy.
4. Reimbursement for Additional Living Expenses
This aspect of the insurance policy only comes into play if your home is damaged to the point where it is deemed unlivable. If the policy holder is forced to find a pied-a-terre, his insurance company will pay for his living expenses while his home is being repaired or rebuilt. This coverage generally includes the cost of rent or hotel bills, food, and even rental car fees. The standard policy provides additional living expenses that are equal to around twenty percent of the value of coverage on the home. So, if you have four hundred thousand dollars of coverage, your family will receive around eighty thousand dollars for living expenses.
Now, that may seem like a lot of money... but trust us, it goes fast. Hotel bills add up in no time and it can take well over a year to rebuild a home that has been ravaged by a flood or fire, which is why it is important to make sure you have enough coverage for each of the components we discussed today.
No comments:
Post a Comment