Insuring your home is one of the responsibilities of being a homeowner. It isn't just enough to carry insurance though. Policies differ between insurance providers. Even within a single company the amount of coverage can differ depending on your policy. You need to make sure that the policy you purchase will be adequate to cover your home and your needs.
Give Your Agent Enough Information
When looking for an insurance policy, you'll probably start by getting quotes for different policies. The price of homeowners insurance is based on a number of factors, so for accuracy's sake, the agent helping you needs to get information about your home. They'll also want information about you and your most recent insurance policy. This helps them get an idea of what the risk of insuring you is like and what they would likely charge as a result. Keep in mind that quotes are never price guarantees. They're more like an estimate of what you could expect to pay and may be different from what you end up paying.
Look at the Policy Details
Not all policies offer the same coverage. You don't want to make assumptions about what a policy covers only to find out that you have damage that isn't covered. It's imperative that you read through the policy details carefully and make sure you understand them. Sometimes what the basic policy covers is dependent on the cause of the damage. For example, flooding originating from pipes within the home may be covered, while flooding due to a broken sprinkler might not. You should add to your basic policy depending on the types of disasters most likely to occur in your area.
Choose the Type of Coverage
When insurance companies pay claims, they typically do so following one of two methods: actual cash value, or replacement cost value. Most of the time, homeowners will find the replacement cost value option more desirable. It covers the cost of replacing the damaged property. The actual cash value method, on the other hand, pays out the value of the property minus depreciation caused by time, wear, and tear. There is also the option of a guaranteed or extended replacement cost coverage, which offers more coverage but is usually more expensive as a result.
There's a lot that goes into making sure your home is properly insured. You need to give your agent enough information, look at policy details, and choose the right type of coverage for you. It takes time to do all that work. Start early so you aren't rushed and can find the policy that works best for you.
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