Homeowners insurance is an important way to protect one of the largest investments you own. In addition to providing assistance should you need to repair something in your home, it can also protect your financial future. Knowing what to expect when seeking out homeowner’s insurance is an important step in ensuring you are covered if the unplanned happens.
While homeowner’s insurance is standard in most areas of the United States, there are special considerations depending upon where you live and your specific requirements.
Perils coverage is an important insurance rider that protects against many types of disasters including theft, tornadoes, and fires. If you have named perils coverage, it will define the specific disasters that are covered. Open perils coverage protects both your home structure and personal property, while condo or co-op owners should select a policy that covers the structural parts of the building that they own as well as their belongings.
Cash value coverage will pay for or repair property and possessions based on the policy limits minus a deduction for depreciation.
Replacement cost coverage will pay to repair or replace your property or possessions based on the policy limits without a depreciation deduction.
Guaranteed replacement cost coverage gives homeowners the highest protection on their belongings because it replaces your home to its pre-disaster state even if it costs more than the policy limit.
Type of damage
It is important to know that not every type of damage will be covered by your homeowner’s insurance. For example, some policies will only cover something sudden or accidental but will not cover incidents that occur over several months such as water damage from a leaky faucet. Additionally, certain natural disasters might also be exempt if you do not have an additional rider. These might include earthquakes and floods.
Personal belonging coverage
It is important to ask if there are any limits on the amount of coverage for your personal belongings. Items of high value may only be covered for a certain amount. Additionally, possessions that are damaged or stolen while you away from your home also may not be covered.