Home insurance

Homeowners insurance protects you financially if you endure a loss due to fire, wind, hail, and/or other covered events. Homeowners insurance will also protect you in the event a person is injured while on your property and decides to pursue a legal judgment against you.

Homeowners policies are personalized for the coverage you seek. You decide which policy is best for you, whether it’s a comprehensive policy that cover losses such as fire, hail, smoke, falling objects, vandalism and theft of personal property, or whether it’s a policy that covers only specified losses.

The amount you pay on your homeowners insurance policy will depend on the coverage you choose. Higher deductibles usually lower your premium price by shifting part of the loss payment to you. For example, if you had a $1000 deductible, you would be responsible for paying the first $1000 of the covered loss. You may choose to set higher limits than the recommended amount if appropriate to your situation and needs.

If you are worried that you don’t have enough coverage then consider an umbrella insurance policy that extends your coverage.

Protection for Your Structure
Property or Dwelling Coverage typically pays to repair or rebuild your home if it’s damaged or destroyed by an insured event like a windstorm or a kitchen fire.

Protection for You and Other People
Personal Liability Coverage applies if someone is injured or their property is damaged and you are to blame. Typically, your liability coverage generally applies anywhere in the world.

When choosing your liability coverage limits, consider your income and your assets. Your personal liability coverage should be enough to protect your worth if you are sued.

Medical Coverage
This covers medical expenses for guests if they are injured on your property, and in certain cases covers people who are injured off of your property. It does not cover health care costs for you or other members of your household.

Additional Living Expenses
If you can’t live in your home because of a covered loss, your home insurance policy will pay additional living expenses-commonly for up to 24 months-while damage is assessed and your home is repaired or rebuilt.

Protection for Your Belongings
Your home is filled with furniture, clothes, electronics and other items that mean a lot to you. Personal Property Insurance helps replace these items if they are lost, stolen or destroyed as a result of a covered loss.

Scheduled Personal Property Coverage
If you have special possessions such as jewelry, art, antiques or collectibles you may want to talk to your agent about this additional coverage. It provides broader coverage for specific items.

• Local construction cost
• The square footage of the structure
• The type of exterior wall construction–frame, masonry (brick or stone) or veneer
• The style of the house (ranch, colonial)
• The number of bathrooms and other rooms
• The type of roof and materials used
• Other structures on the premises such as garages, sheds
  Fireplaces, exterior trim and other special features like arched windows
• Whether the house, or parts of it like the kitchen, was custom built
• Improvement to your home–adding a second bathroom, enlarging the kitchen or other additions that have added value to your home

Most policies cover replacement cost for damage to the structure. A replacement cost policy pays for the repair or replacement of damaged property with materials of similar kind and quality. There is no deduction for depreciation–the decrease in value due to age, wear and tear, and other factors.

If you purchase a flood insurance policy, coverage for the structure is available on a replacement cost basis.

After a major hurricane or a tornado, building materials and construction workers are often in great demand. This can push rebuilding costs above homeowners policy limits, leaving you without enough money to cover the bill. To protect against such a situation, you can buy a policy that pays more than the policy limits.

An extended replacement cost policy will pay an extra 20 percent or more above the limits, depending on the insurance company. A guaranteed replacement cost policy will pay whatever it costs to rebuild your home as it was before the fire or other disaster.

Building codes are updated periodically and may have changed significantly since your home was built. If your house is badly damaged, you may be required to rebuild your home to meet new building codes. Generally, homeowners insurance policies (even a guaranteed replacement cost policy) won’t pay for the extra expense of rebuilding to code. Many insurance companies offer an Ordinance or Law endorsement that pays a specified amount toward these costs. (An endorsement is a form attached to an insurance policy that changes what the policy covers.)

Consider adding an inflation guard clause to your policy. This automatically adjusts the dwelling limit when you renew your policy to reflect current construction costs in your area.

If you own an older home, you may not be able to buy a replacement cost policy. Instead, you may have to buy a modified replacement cost policy. This means that instead of repairing or replacing features typical of older homes, like plaster walls and wooden floors, with similar materials, the policy will pay for repairs using the standard building materials and construction techniques in use today.

Insurance companies differ greatly in how they insure older homes. Some won’t insure older homes for the replacement cost because of the expense of re-creating special features like wall and ceiling moldings and carvings. Other companies will insure older homes for the replacement cost as long as the dwelling is in good condition.

If you can’t insure your home for the replacement cost or choose not to do so–in some cases, the cost of replacing a large old home is so high that you might not want to replace it with a house of the same size–make sure the limits of the policy are high enough to provide you with a house of acceptable size and quality.

Yes – make an inventory of your home and personal belongings. If possible, make a list as well as take photos or video — using two inventory methods can help expedite the claim resolution process. Keep this list somewhere other than your home. Keep in mind that your policy doesn’t cover damages caused by poor or deferred maintenance on your part.

Most homeowners insurance policies provide coverage for your personal possessions for approximately 50 percent to 70 percent of the amount of insurance you have on the structure or “dwelling” of your home. The limits of the policy typically appear on the Declarations Page under Section I, Coverages, A. Dwelling.

To determine if this is enough coverage, you need to conduct a home inventory. This is a detailed list of everything you own and information related to the cost to replace these items if they were stolen or destroyed by a disaster such as a fire. If you think you need more coverage, contact your agent or insurance company representative and ask for higher limits for your personal possessions.

You can either insure your belongings for their actual cash value, which pays to replace your home or possessions minus a deduction for depreciation up to the limit of your policy. Or you can opt for replacement cost, which pays the actual cost of replacing your home or possessions (no deduction for depreciation) up to the limit of your policy.

Suppose, for example, a fire destroys a 15-year-old TV set in your living room. If you have a replacement cost policy for the contents of your home, the insurance company will pay to replace the TV set with a new one. If you have an actual cash value policy, it will pay only a percentage of the cost of a new TV set because the TV has been used for 15 years and is worth a lot less than its original cost. Some replacement cost policies also replace the item and deliver it to you.

Generally, the price of replacement cost coverage is about 10 percent more than that of actual cash value. If you need a flood insurance policy for your belongings, it is only available on an actual cash value basis.

There may be limits on how much coverage you get for expensive items such as jewelry, silverware and furs. Generally, there is a limit on jewelry for $1,000 to $2,000. You should ask your agent or look it up in your policy. This information is in Section I, Personal Property, Special Limits of Liability. Insurance companies may also place a limit on what they will pay for computers.

If the limits are too low, consider buying a special personal property floater or an endorsement. These allow you to insure these items individually or as a collection. With floaters and endorsements, there is no deductible. You are charged a premium based on what the item (or collection) is, its dollar value and where you live.

You can determine the value by providing your agent with a recent receipt or getting the item or collection appraised.

This is a very important feature of a standard homeowners insurance policy. This pays the additional costs of temporarily living away from your home if you can’t live in it due to a fire, severe storm or other insured disaster. It covers hotel bills, restaurant meals and other living expenses incurred while your home is being rebuilt.

Coverage for additional living expenses differs from company to company. Many policies provide coverage for about 20% of the insurance on your house. Some companies will even sell you a policy that provides you with an unlimited amount of loss of use coverage, for a limited amount of time.

You should talk to your agent or company to make sure you know exactly how much coverage you have and how long the coverage will be in effect. In most cases, you can increase this coverage for an additional premium.

This part of your policy covers you against lawsuits for bodily injury or property damage that you or family members cause to other people. It also pays for bodily injury and property damage to others caused by pets. It pays for both the cost of defending you in court and for any damages a court rules you must pay.

Generally, most homeowners insurance policies provide a minimum of $100,000 worth of liability insurance, but higher amounts are available. Increasingly, it is recommended that homeowners consider purchasing at least $300,000 to $500,000 worth of coverage of liability protection.

Let Garden Insurance Agency help you choose a policy that will fit your individual needs. Protecting your assets, whether personal, business, or both, is our goal. A well-chosen policy can lessen the impact of some of life’s most common, yet unforeseen perils. We’re here to help when you are considering Homeowners coverage.