For most people, their home is their most important – and valuable – asset. And yet, many homeowners remain underinsured, putting them at risk of serious financial losses in the event that something damages or destroys their house and the things in it. To make sure your home and your finances are protected in the event of theft or loss, you should consider the following things when determining the right home insurance policy. 

 

What is Homeowner’s Insurance and Do You Need It? 

Homeowner’s insurance helps to repair and replace your house and belongings under specific circumstances. In some cases, it will even pay for other accommodations during the time your home is being repaired and will provide personal liability coverage in the event that you cause property damage or injure another person.   

While homeowner’s insurance is not required by law, most lenders will require you to purchase it before they will give you a mortgage loan. Coverage is dependent on the policy type and includes: 

Dwelling Coverage 

This coverage protects you from damage to your home and the structures that are attached to it, like porches, breezeways, attached garages, and decks. Ideally, you would receive enough money to rebuild your home in the event of complete destruction, but this depends on your deductible and the coverage amount you choose.  

Other Structures 

This coverage insures other structures on your property such as barns, sheds, fences, and detached garages. As with any insurance coverage, check your policy to see what events are excluded from coverage and to determine deductible and coverage amounts.  

Personal Property 

Personal property coverage insures your personal belongings such as furniture, appliances, clothes, and other items. Typically, these items are covered wherever they are – such as a laptop stolen from a hotel room – but are only covered for listed perils, which may include fire, smoke, theft, vandalism, and lightning, among others. 

Loss of Use Coverage 

If your home is too unsafe to live in after a disaster, this coverage will help you pay for other accommodations, as well as meals and other expenses that go along with living somewhere other than your home. However, loss of use coverage is only available when your home is being repaired for damage that occurred for a covered claim, so if the disaster that destroyed your home isn’t covered, these expenses will also not be covered.  

Liability 

If you injure someone or damage their property and they sue you, this policy provides financial assistance in handling costs arising from the dispute. For example, if someone slips going up unrepaired stairs and breaks their leg, they could sue you for lost wages and medical bills. This coverage would help you pay legal fees and limited damages, should you be found responsible.  

Medical Payments 

With this coverage, you don’t need to be found at fault for someone’s physical injury and no lawsuit needs to be filed. For example, if your dog bites a neighbor’s child, but there is no serious damage, this policy could be used to cover the cost of their treatment at an urgent care facility.  

 

Important Things to Know When Choosing Homeowner’s Coverage 

As the markets change and your needs and lifestyle adjust accordingly, you may need to take a closer look at your current policy to ensure that it meets your current goals and that you are adequately protected in the event of a disaster. Consider the following and discuss them with your insurance provider: 

Reconsider Dwelling Coverage Amounts 

In this economy of rising inflation and supply chain woes, you must ensure that your dwelling coverage amount would allow you to rebuild your home based on current labor and construction costs. For this, consider insurance policies that include extended or guaranteed replacement cost options. 

Floods and Earthquakes Typically Not Covered 

An estimated 41 million people in the U.S. live in flood zones, yet not all of them have flood insurance. Floods, along with earthquakes, are disasters that are usually not covered by your standard homeowner’s policy, so if you live in an earthquake or flood-prone area, be sure to get a special insurance policy. 

Not All Types of Water Damage are Covered 

Most home insurance policies cover some, but not all, situations arising from water damage. You can add coverage to protect against other water leak damages such as those arising from sewer backup situations and sump pump failures. Also, consider adding a water leak detector to reduce claims and perhaps qualify for an insurance discount.  

Consider Your Stuff 

To determine the right amount of personal property coverage, start by creating a home inventory that catalogs all your possessions, along with receipts and appraisals. For high-value items such as art, jewelry, and collectibles, consider additional coverage to ensure you can get full replacement value in the event of loss.  

Get Enough Liability Coverage 

Because liability coverage pays for legal fees and settlements in the case that someone sues you over property damage or injuries, you should make sure you have enough coverage to protect all your assets.  

 

Make Your Home a Haven for Years to Come with the Right Protection 

Not only is your home your haven, but for most people it is also your most valuable asset.  

At Schuetz Insurance, we have a team of homeowner’s insurance experts that can help you sort through the various policy choices to find the right mix of protection to meet your current needs. Having a robust home insurance policy can give you peace of mind that you will be protected – and whole – in the event of a disaster. Contact us today to learn more about insurance coverage for homes and belongings today!