Key Things to Know About Homeowners Insurance
Homeowners insurance protects your home and personal property if disaster strikes, and protects you against liability for accident in and around the home that injure others or damage their property. Policies can also cover living expense and medical payments.
Your mortgage lender will tell you the minimum coverage to carry. This is typically at least the amount of the mortgage.
This is the amount you agree to pay out of pocket for each claim against your home or personal property coverage. Higher deductibles mean lower premiums.
Replacement Cost vs. Actual Cash Value (ACV)
You can insure your home and possessions for the amount it would take to replace, rebuild, or repair with similar materials, at current costs. Or you can insure for ACV, which is the amount it would take to repair or replace property after deducting for depreciation. It is obviously lower than replacement cost.
Insurers may offer discounts for alarm systems, deadbolt locks, or covering your vehicle too.
Find out what different insurers charge.
Read Your Policy
Make sure you understand what is covered and what is excluded. Losses from fire, windstorm, and theft are typically covered, though hurricane damage may be excluded. Flood coverage usually requires a separate policy.
Review Policy Yearly
Check in with your agent every year to make sure your coverage is adequate. Home additions, and improvements add value and increase replacement costs.
Please contact us if you have any questions about this or your home financing.