Home isn’t just where your heart is. It is also where most of your net worth is! For most of us, the investment in a home purchase is one of the largest and most important we’ll make. Any wise investor would want to ensure that such a significant investment was adequately protected.
Homeowners Insurance, Getting Started
Making sure you have a policy that meets your specific needs, and at the same time fitting your budget, is a vital part of protecting the investment you’ve made in your first home. Assessing your needs is the first step in evaluating your policy and knowing how much insurance you need.
- How much would it cost to replace your home and your personal belongings?
- Do you have expensive jewelry or other particularly valuable possessions?
- Are there other permanent structures on your property?
The second step is making sure you know what is included in your policy, and just as importantly, what is not. Standard policies typically provide coverage in four essential areas: the structure of your home, personal possessions, your liability to others, and living expenses should you be unable to live in your home temporarily as the result of a disaster your policy covers.
It is crucial that you know which disasters—or “named perils” in the language of insurance—are covered by your policy and whether you need additional coverage for any excluded peril.
Understanding What Coverages You Need
While we are here to explain what your homeowner’s insurance covers and doesn’t cover, it’s important to have a basic understanding before you start shopping. Here are some homeowner’s insurance terms to become familiar with.
It helps protect your home’s structure, built-in appliances, and wall-to-wall carpet from damage.
It helps cover your personal property not attached to or built into your home, such as furniture and clothing.
If an accident occurs in your home that damages someone or something, personal liability can help pay for covered damages.
Medical payments to others
May help pay for medical or funeral expenses of someone who is injured on your property.
Ordinance or law insurance
May help pay to rebuild your home to current building codes after a covered loss.
Covers additional structures not attached to your house, such as a shed, fence, barn, detached garage, or gazebo.
Loss of use
Coverage to help pay for additional living expenses if you’re unable to live in your home due to a covered loss.
Credit card coverage
Pays up to your selected limit for unauthorized transactions on your credit cards and bank debit/ATM card. It also applies to forged checks and counterfeit money.
What is a deductible?
Most homeowners forms contain deductible provisions applicable to losses occurring under Section I (Section I losses include (a) dwelling, (b) appurtenant structure, (c) unscheduled personal property, and (d) additional living expenses). The type and amount of deductible varies by company. Some companies offer an optional deductible that applies only to wind or hail losses. Most offer higher deductible options such as $500 or $1,000 at a reduced premium.
Remember it this way, a deductible is how much you pay before your insurance kicks in.
What property and perils are excluded from most homeowner policies?
Most homeowner policies provide coverage that does not apply to animals, birds, fish, automobiles and business property; for loss or damage caused by flood, surface water, water which backs up through sewers or drains, earth movement, nuclear damage, war, etc. A complete review of your policy is the only way to determine what property is covered and what perils are insured against.
At Paradiso Insurance, we know what works for one Connecticut homeowner won’t necessarily work for another. That’s why we listen to you, determine your situation, and then create an individualized homeowner’s insurance plan that addresses your unique needs—and home. Call us today at 860-684-5270 and let us get to work for you.