Buying a home is one of the biggest financial investments you will ever make. It may also be your largest source of equity, so your homeowner’s insurance needs to protect it from damage and destruction due to fire, vandalism, and other hazards.
Purchasing a policy sounds like a straightforward process, but there is no single solution that meets the needs of all homeowners. Typical policies come with certain types of coverage, but they are still customized to account for the unique needs of your property and your lifestyle. To ensure that you get the right protection, look for these five things when you’re shopping for a homeowner’s policy.
- Comprehensive Coverage
A comprehensive perils policy is essential. While a named-perils policy will cover common issues like fire damage and theft, any other events that aren’t specifically named will not be covered. In addition, you will have to prove that a named issue damaged your property, which is not always easy and creates additional stress at an already-upsetting time. A comprehensive policy will give you more peace of mind.
- Guaranteed Replacement Cost
Many insurance companies limit the amount they will pay if your home is damaged by a covered event, leaving you to make up the difference. A guaranteed replacement cost clause will ensure that the insurer will cover the expense of fully replacing your home, even if the cost exceeds your limits. Don’t buy a policy unless it includes this essential component.
- Loss of Use Clause
Some incidents can leave your home so badly damaged that repairs take months and even years. A loss-of-use clause covers your extra living expenses, such as moving costs, property storage, and pet boarding, while the property is being rebuilt. Coverage is usually capped, but some insurers will let you buy more if your standard of living recommends it.
- Personal Property Replacement Coverage
Replacement coverage for your personal property is usually calculated as a percentage of your home’s value. Luxury items tend to be subject to replacement limits, so if you own a lot of high-value items, you will want to purchase extended coverage.
- Personal Injury Liability
Homeowner’s insurance can protect you from a financially devastating personal injury lawsuit. Make sure that your policy covers you if someone is hurt on your property: too many people simply assume that they’re covered, only to learn the truth at the worst possible time.
While personal injury liability is commonly included in homeowner’s insurance policies, in some cases it has to be endorsed separately. Always confirm before you sign off on the policy.
Florida homeowner’s policies don’t cover damage due to floods, earthquakes, or sewer overflow. Flood insurance can be purchased from the Federal Emergency Management Agency while earthquake coverage is available from private insurers. You can add sewer coverage to your policy, but it will increase your premium by up to 10%.
When you sign a homeowner’s insurance policy and pay all the associated fees, the insurer should honor their responsibility in the event that your home is damaged or someone is injured on the property. If they show bad faith by denying coverage when you have a legitimate claim, call the Monfiston Firm, P.A. at 888-988-FIRM (3476). If insurers try to improve their bottom line by refusing claimants, we will help you get the compensation you deserve.