Donovan & Morello, LLP
What You Need to Know about Homeowner's Insurance
Your home is probably your most valuable asset, so it’s important to make sure it is protected with homeowners insurance.
A standard homeowner’s policy will provide you with the basic protections like fires and theft, but a standard policy has limits which can leave you with holes in your coverage.
Homeowner’s coverage does not generally provide protection for natural disasters such as flood or earthquakes. The Federal government has a program through which homeowners can purchase flood insurance to protect against flood damage such as was caused by Hurricane Irene and Superstorm Sandy. Even if you are not in a recognized flood zone, it may be a good idea to purchase flood insurance, since floods can occur anywhere due to torrential rains as we have seen in Texas and other plains states.
Additionally, you should make sure that your policy covers the costs of rebuilding and refurnishing your entire home, as well as the cost of trucking away demolition debris. Once you know the replacement value of your home, you can purchase replacement coverage which expands your limit to about 125 percent of your home’s value. You can also purchase an inflation rider which makes sure that the replacement coverage stays current with repair costs and current market value.
Don’t forget to review your personal possessions to make sure that they are covered. Most policies provide coverage limits for certain items such as jewelry, expensive electronics, antiques, artwork, firearms and other valuable items. You can, however, purchase riders for these particular items, which will insure them for full value.
Lastly, you should keep in mind your deductibles. Higher deductibles result in lower premiums. Also, most carriers will give discounts if you insure your autos with them as well as your home. It is also good practice to review your policies periodically to ensure that the valuations and possession are current.