Nowadays with life being so hectic we have a list for just about everything. Our daily lives include errands, groceries and tasks to complete. But do you have a homeowner’s insurance coverage checklist? Hurricane season begins on June 1st and runs through November 30th, now is the perfect time to read over your policy. We have a list that can make it easier to be prepared in case a hurricane heads your way.
Homeowner’s Insurance Coverage
Check your current policy
Make sure your coverage reflects the cost to completely rebuild your home if it is severely damaged or destroyed. The value of your home is not the same as the cost to rebuild it which will include material and labor. The following are additional homeowner’s insurance coverages that protect your home against rebuilding costs after a disaster.
- Extended Replacement Cost pays an additional percentage above the policy limits
- Guaranteed Replacement Cost pays you the full amount to rebuild your home regardless of the cost
- Inflation Guard automatically adjusts coverage limits to reflect the rise in construction costs
Conduct an inventory of your home
Do you know how much your personal possessions are worth? Now imagine having to buy all new furniture and clothing after a disaster occurs. Your homeowner’s insurance policy covers personal possessions for approximately 50 to 70 percent of the coverage amount for your home. Take inventory of your personal possessions to determine how much coverage you need. It is helpful to keep receipts or statements of the items description and cost.
- Replacement Cost Coverage would pay you the cost to replace your personal possessions at their current value
- Actual Cash Value replaces your personal possessions but only at the depreciated value of the item
- Additional coverage
Most homeowner’s insurance coverage offer Additional Living Expenses coverage if for any reason you can no longer live in your home because of a disaster. If you have to live away from home this coverage pays for extra costs such as hotel, bills and meals. It will also pay for other expenses you have incurred while your home is under construction. Reimbursements and coverage is only for a specific amount as well as time you will find that stated on the policy.
- Deductible stated on policy
Homeowner’s policy will carry a deductible amount paid out before a claim payment is given to you. Generally, hurricane and windstorm deductibles range between 1 and 2 percent of the value of your home. If you live along the coast your deductible may be a higher percentage as the risk higher for coastal homes.
- Disasters covered by policy
A standard homeowner’s insurance policy covers hurricane, wind, theft, fire , explosion, lighting, vandalism but excludes flood and earthquake coverage. Read over your policy to know exclusions or talk to your agent before a disaster occurs and you have to pay for damages out-of-pocket. You can purchase additional coverage to your policy to protect your home from Sewer Back-Up. This coverage pays for damages caused to a sewer from runoff water caused by major storms.
- Flood insurance coverage
If your home is damaged as a result of flooding it is not covered under a homeowner’s insurance policy. Flood insurance covers up to $250,000 in replacement cost coverage on your home and $100,000 in actual cash value of your personal possessions. If your home includes a basement check your policy as coverage is limited. Keep in mind that flood insurance carries a 30-day waiting period before the policy goes into effect. Do not wait to the last minute before a storm to apply coverage.