Do You Have Enough Home Insurance Coverage?

According to an article in the Wall Street Journal, a survey released by the Insurance Information Institute, found that nearly half of all American homeowners mistakenly believe that their homeowner insurance policy will cover them against losses due to floods. It does not. While most standard homeowner policies (the one required by the lender) does cover water damage resulting from burst pipes or an appliance leak, it will not cover you in the event of a flooding.

Flooding, as defined by the National Flood Insurance Program, as excess water on land that is normally dry, affecting two or more acres of land or two or more properties, is covered by a separate flood insurance policy. Therefore, if you were aware of this information, and is fully covered, that is great! If not, in addition to speaking with your insurance advisor, here are five types of insurance coverage you nay not be aware of.

Excess flood insurance. Even if you have a standard flood policy, it might not be sufficient to protect you. Policies purchased through the National Flood Insurance Program may be capped at 250,000 for your homes structure and 100,000 for contents.

Jewelry and collectibles coverage. Whether your valuables consist of jewelry, art, comic books, or a wine collection, you need valuable articles coverage to insure their full value. A standard home owners insurance policy has limited coverage for these items and, in the case of loss, a deductible may apply.

Workers compensation. Workers compensation insurance covers the medical expenses and lost wages of baby sitters, or other household employees who are injured or become ill while working in your home. It also protects you, as the employer, from liability.

Cyber insurance. Personal cyber protection may cover your losses arising from identity theft, hacking or cyber stalking. If your identity is stolen, cyber insurance may be able to replace monies that was stolen and ensure that you have the financial and administrative resources you need to get your life and identity back.

Umbrella policy. An umbrella policy provides excess liability coverage to help protect you and your assets when the limits of your home or auto policies is not sufficient to cover the cost of a lawsuit or accident.

After going through the above list, if you're thinking about adding additional insurance coverage to protect your assets, here are a couple of additional things to consider:

• Coverage varies widely between loss of use coverage
• Also, know your homes replacement cost. Using the price you paid for your home may not be a good idea. Why?

Because, the cost of construction materials and labor continue to skyrocket due to the previous supply-chain disruptions caused by the pandemic, which means the costs to rebuild your home may now exceed your current policy limits. Read your policy to determine current limits, and, if necessary, speak with your insurance advisor about increasing those limits to cover the full replacement cost of your home.

I remind clients long after they close and moved into their home, to evaluate their insurance limits for replacement cost because what they paid for their homes a year or two years ago, will most likely cost far more to rebuild it today, in the event of, for example, a fire.

If it matters to you, it matters to us. We are always looking out for your best interest. As always, thank you so much for stopping by, and remember, if you are thinking of purchasing your new home, or selling an existing one, please give us a call. We are here to help. We have been helping home buyers and sellers 12 years and counting. Until next time...Diana

Source: WSJ

Image by: Diana Walton

Astor & Eaton Realty
Diana Walton
Real Estate Broker
713.208.8013
Write to Diana Walton at homes@astoreaton.com
https://www.har.com/dianawalton

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