Home Insurance protects your home sweet home

Home is one of our basic necessities. We all have emotional attachment with our home, be it a pigeonhole or a palatial residence. Protecting it through insurance is a must to take care of the unpredictable risks to your house such as fire, natural calamities, burglary, short-circuits etc.

Such incidents would not only cause severe mental agony but the losses you may suffer under such circumstances can be unimaginably high. And setting up your house all over again can be quite expensive. But if your house is adequately insured such botherations need not be a cause for worry.

Insurance bought for your house will not only cover the structure of the house but will also cover the belongings. All those expensive items or consumer durables you bought over a period of time may have been damaged in the fire. But your insurance company will take care of the losses and indemnify you for it.

Similarly if your house is burgled and your valuables have disappeared your insurance company will bear your loss. Or for instance, your domestic help, is electrocuted in your house and dies. The insurance company can pay off the losses and liabilities that may otherwise be a concern for you, under the Workman’s Compensation Act.

In other words buying an insurance policy for your house will buy you peace of mind as such risks are unpredictable but not impossible. Check out the following tips before you buy your home insurance to help you maximize your coverage and minimize your risk.

Market Value vs. Replacement Cost

• Market value – The price agreed to by a buyer and seller. This price may have been influenced by many different factors (location, age, etc.).
• Replacement cost – The actual cost of rebuilding the house after complete loss. This cost will fluctuate depending on the cost of materials, construction, etc.

You should have enough coverage to rebuild their house in the exact style and quality of the original home, after taking inflation into consideration. You should review your homeowners policy with your insurance agent to ensure that you have adequate coverage in case of emergency. Getting a correct coverage amount will ensure that you don’t incur big expenses when rebuilding your home.

Planning for Natural Disasters

The replacement cost premise can be applied to natural disasters as well. Shortcomings in your policy’s coverage could leave you holding a big bill when it comes time to rebuild your home after a natural catastrophe. Each insurer can offer its own coverage, limits, and pricing. Be sure to shop around for the best deal that fits your situation.

Making a List and Checking it Twice

Keeping an updated inventory of your belongings can save you from losing your mind in the event of a theft or accident. Here are some tips on how to keep an effective inventory:

• Include price, as well as where and when it was bought in your listings. Try to keep receipts and take pictures. This is especially necessary for big ticket items.
• You should take special steps to protect possessions that are hard to replace or expensive, such as fine china, musical instruments, jewelry, computers, and works of art. Most policies cover these items only up to a certain amount or limit.
• “Schedule” these valuables on your policy. For an extra cost, this endorsement lists special items and appropriate coverage amounts. For certain items, such as jewelry, current appraisals may be required.
• Take replacement cost into consideration. The value of your belongings follows the same logic as the value of your home.
• Take photos of each room. This will also act as a great memory aid if there are too many items to inventory in a particular room.
• Use an experienced and knowledgeable agent.
• Service is important. Your policy is only as good as the company’s ability to pay the claim. Make sure the insurance company that holds your policy is financially stable and has a reputable record for fast and fair service when settling claims.
• A protection system can save your property, as well as your money. If your house is equipped with smoke alarms, dead bolt locks, or burglar or fire alarms, a premium discount may be available.

Tips for Every Homeowner

• Use an experienced and knowledgeable agent.
• Service is important. Your policy is only as good as the company’s ability to pay the claim. Make sure the insurance company that holds your policy is financially stable and has a reputable record for fast and fair service when settling claims.
• A protection system can save your property, as well as your money. If your house is equipped with smoke alarms, dead bolt locks, or burglar or fire alarms, a premium discount may be available.