Your home is probably your most greatest asset. To avoid being underinsured, you should always know what is being covered in your homeowner’s policy. It’s imperative that you do your research and ask the right questions. Many policies fail to cover the basic disasters, while some may offer extra benefits that you may not be aware of. Here are some key questions to ask your insurance agent.
It’s a surprise to find out that many disasters are not covered under a standard policy. Disasters such as earthquakes, floods and hurricanes are rarely covered under a basic policy.
Termites are one of the biggest pest threats to a home. Unfortunately, many homeowners find out too late that termite damage is not covered. Also, bed bugs, mice and other infestations are usually not covered.
Insurance agencies treat mold problems similar to pest problems. It’s the homeowner’s duty to keep up the day-to-day maintenance, fixing a leaky sink for example. In the eyes of the insurance agency, mold damage caused by a leak is a preventable problem. With that said, insurance agencies will usually pick up the bill for a disaster such as a sewage backup in the basement that is responsible for your mold infestation.
Let’s face it, accidents happen. Make sure your policy covers you if someone gets insured on your property.
Many people make the mistake of thinking the worth of the home and the rebuilding costs of the home are one and the same. Find out what your rebuilding costs will be and then decide if you want 100 percent coverage (which is the most expensive policy) or if you?d rather chance it and only cover 90 to 80 percent of the rebuilding costs.
If a disaster causes you to have to be relocated while your home is being rebuilt, you should know what your policy will cover. For example, there could be hotel and restaurant costs which would fall under ?additional living expenses? or ?loss of use costs.? The insurance company might offer a cap on the amount or only cover a certain number of days.
Conducting a home inventory is the best way to determine if there is enough coverage to replace your possessions. In a home inventory,? you detail everything you own and calculate the estimated cost to replace those items. Always keep another copy of your home inventory list outside of the home for safe keeping.
As a homeowner, you should update your insurance regularly to include improvements, major purchases and increased rebuilding costs. For more information on what to ask your insurance agent, read this article from Insurance Information Institute.