Property and Possessions Coverage
The first step in the decision making process for your Homeowners Insurance policy is to determine the value of the dwelling itself and the personal property or contents that you want to cover. It is likely that your single largest asset is your home, and you want to have adequate coverage to protect yourself against catastrophic loss. Most policies provide a stated maximum amount of coverage for the dwelling and another amount for contents.
Dwelling coverage is based on replacement cost, or the actual cost to replace the structure, not the purchase price or the value of the structure when purchased. You should buy enough insurance to completely rebuild the home. We will help you to obtain an accurate appraisal of the home for replacement cost. Most insurers recommend or require that a homeowner insure the dwelling for 100 percent of its full replacement value. When market values are fluctuating up or down, it is a good idea to revisit the replacement value question frequently.
Regarding contents, most policies provide a choice of actual cash value coverage for contents, including depreciation, or full value of contents without depreciation. Actual cash value may mean that a 10 year old television may have little or no value. Full value contents coverage would provide a new tv. A homeowner may want to consider replacement cost coverage to be sure that the contents are adequately insured. The cost of full value insurance is higher, of course. Whichever type you use, it is wise to video tape your contents from time-to-time and keep that information on a disk away from home, such as in a safe deposit box.
Homeowners should purchase additional specific coverage for items that would ordinarily be subject to loss limitations such as jewelry, fine art, furs, electronics, collectibles, oriental rugs and antiques. Items such as furniture, clothing, toys, accessories are covered under the general policy.
Condo owners you will need to check with your Condo Association By Laws to determine which of two broad categories of master policies covering the exteriors of the units and the common areas you have. Your Jaffe Insurance professional can help you with an appropriate policy once it is determined the coverage provided by the association.
Bare walls in covers all real property from the exterior framing inward but does not cover fixtures or installations within a condo unit. Features such as bathroom and kitchen fixtures countertops, and even flooring are not covered.
All in policies cover fixtures and additions within the interior surfaces of the perimeter walls and the floors and ceilings of individual units.
Renters only need to cover their actual personal property within the unit or any separate storage in the building. The landlord is responsible for all structures and fixtures. These policies are very inexpensive, and the loss of just a few pieces of electronic equipment can be worth years of premiums.
Liability insurance is very important to a homeowner's condo owner's or renter's coverage because it helps protect the owner or renter against financial disaster if the homeowner is legally responsible for someone else's injury or property damage. Examples would include someone slipping and falling on your property, or any member of your family harming another person. The standard liability limit for most policies is $100,000 which may not be adequate if you have substantial assets. For a small increase in premium, an additional $300,000 to $500,000 may be obtained.
Another way to protect one's assets is to consider an Umbrella Policy which usually adds $1 million (or possibly more) in excess liability coverage to the homeowner's property and automobile insurance policies. It also covers claims excluded from most basic policies such as libel, slander, defamation and mental anguish.
Theft Off Premises
Most policies insure against the loss of personal property if that property is not on the insured premises when lost. For example, you may be have substantial personal property on a camping trip that may be stolen or destroyed. This would be covered.
Additional Living Expenses
Almost all polices provide coverage for living expenses if the covered premises is damaged to the point of being uninhabitable. The policy pays for the cost to repair the damage to the dwelling, and also reimburses the homeowner for the additional expenses of living elsewhere while the repairs are being made. This is an important provision. Ask us about this provision.
What Can A Homeowner Do To Be Prepared?
Make an inventory of items room by room is important to have with information such as the date purchased, serial number, the original cost of each item and a brief description. Video or still photos are very helpful along with the inventory. Store the inventory information in a safe place such as a safety deposit box and not in the home.
Nine Ways to Save Money On Your Homeowners Insurance!
1. Use an agent
Insurance is a highly competitive business and Jaffe Insurance Agency uses highly rated insurance providers who are always striving to offer outstanding value. By using an agency such as Jaffe, you know that we will shop your exact needs to determine how to get the lowest rate that covers your assets adequately.
2. Buy home and auto policies from the same insurance company
Most insurance companies that sell homeowners and auto coverage reduce their premium substantially if two or more policies are purchased from them.
3. Increase the deductible
Deductibles are the amount of money that you, the homeowner or renter, pays toward a loss before the insurance company starts to pay. Deductibles typically start at $250. By increasing the deductible to $500, $1,000, $2,500, or $5,000, discounts may be obtained. As you accept more risk, the premium cost goes down.
4. Home security
Most policies offer discounts for burglar and fire alarm systems or other security or fire detection systems. Before buying such a system, check with us to determine if that system will be eligible for a discount.
5. Think about the insurance costs before you buy a home
Before you purchase a new home consider how much insuring it will cost. When buying a new or newer home, the electrical, heating, roof, plumbing systems and overall structure are likely to be in better shape than those of an older house. Insurers generally offer a discount if the house is new. Choice of construction materials and design could reduce the premium. Proximity to fire station, firefighters and fire hydrants also affects premiums.
6. Insure the house, not the land
The land under the house isn't at risk. Therefore, the value of the land should not be included in deciding how much homeowners insurance to buy.
7. Senior Discounts
If a homeowner is 55 years old and retired, they may qualify for a discount.
8. Review your coverage annually
Evaluate the value of your possessions annually. Divorce, children moving out, or other changes in your life may have reduced the value of our possessions.
9. Smoking can cost you
Some insurers offer to reduce premiums if no residents in a house are smokers.
Things to Remember About Your Coverage
Policies should cover any major purchases or additions to the contents of the home from year-to-year. Any additions to the physical structure of the home should be reported to your agent for a reevaluation of the coverage on your policy.
Review your prized possessions that require a special scheduling on your policy. Items such as jewelry, watches, furs and computers may need to be listed and covered individually. If you have sold or given away any special schedule items, you will want to remove these from your policy.
Because there are so many options and variables associated with home owners/condo owners/renters insurance Jaffe Insurance Agency provides free reviews and quotes.