Homeowners insurance

Make it Simple-Homeowners Insurance

   Have you tried to read your insurance policy and just given up? It can be very confusing! This is our second post in our series, Make it Simple. Our goal is to help you understand your insurance policy.

    Every policy (regardless of type) should have a Declarations Page, commonly referred to as the “Dec Page”. This page “declares” who you are, what property you have insured, your coverage choices and how much you are paying for this policy period. 

There are 2 types of coverage on your Home insurance policy: Coverage that protects the other party and coverage that protects you.

Coverage that protects the other party:

Personal Liability: Covers you if someone is injured on your property due to your negligence.  It may help pay for their injuries and any legal costs.

Medical Payments: May provide reasonable and necessary medical expenses to a guest on your property injured in an accident.

Coverage that protects you:

Dwelling Value:  The dwelling value is set at or above the estimated replacement cost of the home, which includes the cost to haul away debris, and the contractor’s overhead & profits. This coverage can be written at Actual Cash Value (the value to rebuild the home minus depreciation based on the age of the home) or at Replacement Cost (value to rebuild the home at today’s quality and price). I rarely suggest ACV policies.

Other Structures:  covers buildings SEPARATE from the house—pool, fence, storage shed, detached garage, etc. This usually defaults at 10% dwelling value. 

Personal Property:  Contents of the home. This can also be written at ACV or Replacement cost coverage. If you have a total loss to the home, the carrier will write you a check for the total personal property, regardless of whether you have RC or ACV coverage. If you have a partial loss such as a small fire or theft, they will only give you the coverage you have paid for; meaning if you have ACV coverage, your 8 year old TV will only be covered for the value of an 8 year old TV. If you have Replacement Cost, your coverage will cover the cost of a new TV.

Loss of Use:  May provide reimbursement for reasonable increases in living expenses (such as a hotel room or apt) due to a covered loss, if your home is uninhabitable.

Deductibles:  is the amount you pay out of pocket when you file a claim for a covered loss. There are 2 main types of deductibles;

            Wind/Hail Deductible: This covers your home in the case of high winds or hails, usually seen during severe storms.

            All Other Perils Deductible: This covers your home for the remaining perils listed in your policy, such as fire or theft. Keep in mind, home insurance policies do not cover floods. You will have to buy a separate policy for flood insurance.

    If you have questions about your home, auto and commercial insurance, please call Brockman Premier Insurance at 877-987-8683 or email us at brian@brockmanpremier.com.
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