Property ownership is, in many ways, a financial commitment — an emotional one as well. You have to defend your choices and defend your property, so it’s no wonder that people want to protect their investment, be it through homeowners insurance.
As a homeowner, you have a lot of choices for ensuring your property is protected. While you don’t have to have every kind of policy available, it can be easy to get carried away.
Here are five tips that can help you stay focused on what you need and keep your costs in check:
1. Determine Your Replacement Value
You need to know how much your home is worth, so you can make sure that the amount you’re covered for is appropriate. You can update your home’s value by hiring a professional or using a home appraisal service. The value of your home should be the price it would sell for right now, even if you are selling in a bad market.
The replacement cost, on the other hand, is how much your home would cost to rebuild today. If you’re in a floodplain, for example, it may cost more to rebuild your home than it would elsewhere. Be sure to factor in any “improvements” you have made to the property. If you have added a deck or a patio, those add-ons should be included in the cost to rebuild.
2. Know Your Budget
Determine how much you can afford to pay in homeowner’s insurance before shopping around. This way, you know what you can afford, instead of just deciding based on price. It’s possible, if you have a generous deductible and low rates, that you could pay a little more for your insurance if it means you can afford to pay for other things you need.
Many people skip this step and then wind up paying for things and insurance that they really can’t afford, which is why so many Americans are saddled with debt.
3. Always Know the Facts
Homeowner insurance will only go so far. If you have a plumbing problem that creates a toxic mess in your basement, your insurance policy will cover cleanup costs. It will also cover some of the damage to the house, but not all of it. Speak to an agent in person, so you know exactly what is covered and what is not.
It is always best to ask questions. An insurance policy full of loopholes could be worthless in a disaster. For example, many policies only cover the house and not the contents. Ask if the policy covers mildew on your carpets, broken china, and storm windows.
4. Choose a Full Coverage
The only way to make sure you are completely covered is to have a full insurance policy. It might be tempting to opt for a basic policy, but you might find yourself in trouble if you do. It’s better to have insurance that costs more but offers complete protection.
For example, a policy might not cover additional living expenses. Basic policies will cover the cost of rebuilding your home, but if you have to live somewhere else until it is rebuilt, that won’t be covered without an add-on policy. A full policy will also cover your expenses if you have to stay in a hotel if your home is uninhabitable.
5. Protect Your Financial Assets
Last but not least, it’s important to make sure that you have the right homeowners insurance to protect your financial assets. It’s dangerous to assume that all policies are the same because they are not. Depending on the state and type of property, a policy may be worth significantly more than another policy.
The reason for this is that states have varying requirements for coverage, which means policies from state to state can vary greatly. Additionally, if you live in a state that has a high risk for natural disasters or crimes, your policy will cost more than one from a state with low risk.
Homeowners insurance is an important step in protecting your home and its contents. To get the best coverage and the best value for the price, you should take the time to review your options and shop around. By doing so, you can get the best possible protection for your investment.
Are you looking for a new home insurance plan or an insurance company? 5258 Insurance can offer you the best homeowners insurance in Englewood that will give your home the protection it needs. Let us help you compare plans and to find the right one for your needs. Contact us today to learn more about how we can help.