Homeowners Insurance Policies

A recent study shows that despite 95 percent of homes being insured, almost 70 percent are under-insured. According to the Insurance Information Institute, property damage and theft accounts for over 90 percent of home insurance claims. You can never have enough insurance.

Homeowners insurance is a package policy that covers both property damage and legal liability for any injuries or property damage. This provides protection against disasters and financial issues. Keep in mind that it does not cover any problems that occur due to wear and tear and poor maintenance.

Home insurance isn’t a legal requirement, but many mortgage companies require it. The mortgage company may also require flood or earthquake insurance, which are purchased separately, depending on the risk in your area. Homeowners usually want coverage for personal property protection for valuable belongings and to protect against natural disasters, such as fire, windstorms, hail, etc. Homeowners also want bodily injury liability for anyone injured while on the property. This will cover the financial costs of legal and medical bills.

Many major insurance companies offer some form of homeowners insurance. Consider having a professional perform a home inspection. This will allow you to uncover problems and fix them, thus lowering your premium. The homeowner will complete a home inventory of possessions. The insurance agent will assist the homeowner with establishing a liability limit, deciding on coverage needs and setting replacement costs vs. actual cash values.

A basic policy will include basic information, such as contact info, insurance cost, coverage amount, property description and names/addresses. It will also include definitions, coverage details, any exclusions, conditions and endorsements. There are basic types of home coverage, which include HO-1 (limited coverage), HO-2 (Basic, protects against 16 disasters), HO-3 (Standard, protects from all disasters except those specifically excluded and HO-8 (for older homes). Those renting homes use the HO-4 Renter policy. The level of coverage depends on the state of home, location, any protective devices and personal factors.

Financial protection, peace of mind, custom provisions and protection against interior and exterior damage are all excellent benefits.

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