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While our goal is to find you a competitively priced policy, our primary goal is to provide you with a policy that meets your expectations when you really need it most. Along the way, we also focus on identifying all the insurance discounts you are eligible for! Reading through this page will help you participate in the customization of your own homeowner policy and help you make important decisions regarding what’s covered and how much it’s covered for.
Homeowners insurance pays the costs to fix and/or replace your home and the property inside it. In certain situations, if you are liable for damages, it also pays to fix and or replace other people’s property and pay their medical fees. Since the homeowner policy is not an easy document to read, we’ve highlighted and simplified some of the key coverages, below.
Overview of the Home Owner Policy
How much homeowners insurance do you need? If you own a home and are living in it*, you can purchase insurance to
- Cover rebuild/replace your home if it is damaged by an insurable loss
- Cover your additional living expenses if your home is damaged by a covered loss and you need to live someplace else while your home is being repaired
- Replace your personal possessions if they are damaged by an insurable loss
- Cover your liability to others
Note: If you own a home and are not living in it, insurance is still available for you, but it will look a little different. Give us a call to get informed on this subject!
Rebuilding/Replacing Your Home
Homeowners insurance protects your investment in your home. You need enough insurance to cover the cost of rebuilding your home at current construction costs. The amount of coverage to purchase is not tied to the resale value of your home, even if the resale value is much lower than the cost to rebuild. Some banks require you to buy homeowners insurance to cover the amount of your mortgage. Remember, YOU determine the needed coverage to rebuild, not the bank. You’ll likely need more coverage than the bank requires. For a quick estimate of the amount of insurance you need, multiply the total square footage of your home by local building costs per square foot. Many insurance companies will require at least $100 per square foot. Factors that will determine the cost of rebuilding your home include:
- Local construction costs
- 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, etc.)
- The number of bathrooms and other rooms
- The type of roof and materials used
- Fireplaces, exterior trim and other special features like arched windows
- Weather the house, or parts of it like the kitchen, were custom built
- Improvements to your home-adding a second bathroom, enlarging the kitchen or other additions that have added value to your home
Standard homeowner policies provide coverage for disasters such as damage due to fire, lightning, hail, explosions and theft. They do not cover floods, earthquakes or damage caused by lack of routine maintenance. Flood and earthquake coverage can be purchased.
Additional Living Expenses After a Disaster
This coverage 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. You adjuster will help you figure all of this out when the time comes (hopefully it won’t come!). If you rent out part of your house, this coverage can also reimburse you for lost rent that you would have collected had your house not been damaged.
Liability to Others
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 damage caused by pets. It pays for both the cost of defending you in court and for any damages a court rules you must pay. You have great flexibility on how much liability coverage you can purchase, starting at $100,000 and going up to $1,000,000. Increasingly, it is recommended that homeowners consider purchasing at least $300,000 to $500,000 worth of coverage of liability protection.
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