You’ve finally bought a home and are ready to buy the homeowners insurance that will protect your investment. But, suddenly what seemed so easy before doesn’t look quite so simple now. How do you decide which homeowners policy is right for your needs? If you aren’t a homeowner yet, many of the same things apply to renters insurance Friendswood TX. Here are 10 things you should do to ensure that your home is covered in the event you are involved in a disaster.
Buy the Right Insurance
There are eight separate categories for homeowners insurance and many different variations in policies inside each one. Most homeowners will need an HO-3 policy, but you may need additional coverage for flooding, earthquakes, and other special perils. In addition, you need to make sure that the limits in your policy are enough to cover your needs in four separate categories: structure, belongings, liability, and living expenses.
Replacement Value vs. Cash Value
Insurance policies have two positions when it comes to paying claims: replacement value or cash value. Cash value policies will pay you the depreciated value of your assets, including your house, in the event of a loss while replacement value will pay you the amount of money it takes to replace your items at current market values. You should always go with replacement value insurance for your house and should try to have it on your belongings, if you can afford it.
An insurance policy is only as good as its claims process. You need to understand how your insurance company pays claims in order to ensure whether or not it will work for you. Some companies will pay the value of your claim to you upfront so that you can begin rebuilding your life after a loss, while others will reimburse you for purchases you make. Others will pay you for everything you’ve lost while others will only pay you for the items to replace.
In order to ensure that you have as smooth of a claims filing experience as possible, you need to document the items that you own. Most insurance companies recommend that you document your items with a video camera or by taking photographs. Walk through each room and photograph or video your belongings, making sure that you don’t miss the attic, basement, and other storage buildings. Keep at least three copies: one in your home, one in a safety deposit box and one with a trusted friend.
Insure Valuable Items Separately
If you have valuable items like jewelry, electronics, artwork or other collectibles, you need to carry a separate floater policy for them. This will require you to have the items appraised. These policies are designed to provide coverage for one specific item only.
The value of your home will rise the longer that you live in it. This is why it is important to review your policy every year to ensure that the homeowners insurance Friendswood TX you carry is enough to cover the value of your home. This is also a good time to review your personal belongings coverage to ensure adequate coverage. If you have added things to your home in the previous year, now is the time to document it and add the video or photographs to your repository.