Coming Home to the Right Insurance Coverage

For many individuals, their home is their pride and joy.

That being the case, why wouldn’t they want to make sure it was properly insured to protect not only their possessions but against potential liability should a guest or professional be injured there?

A standard homeowners’ policy includes four main types of coverage. They are: Coverage for the structure of the residence; Coverage for one’s personal possessions; Liability protection; Added living expenses in case the individual/s must be out of the home for a period of time due to a fire or other insured disaster

When it comes to the structure of the residence, this portion of the policy pays to reconstruct or repair one’s home should it be damaged or destroyed due to fire, hurricane, lightning, hail or other listed disaster. The policy will not compensate for damage resulting from an earthquake, flood or regular wear and tear.

Many standard policies also cover detached structures like a shed or garage. Typically, these structures are covered for approximately 10 percent of the amount of insurance one has on the structure of their home.

As for personal belongings, an individual’s clothing, furniture and other such items are covered in the event they are destroyed or stolen by fires, hurricanes and other insured disasters. Many insurers offer coverage for 50 percent to 70 percent of the amount of insurance an individual has on the structure of their residence.

This portion of one’s policy includes off-premises coverage, meaning that one’s belonging are covered worldwide, unless that individual has decided against off-premises coverage. Some insurers limit the figure to 10 percent of the amount of insurance one has for their possessions. Individuals also have up to $500 of coverage for unauthorized use of their credit cards.

Expensive items such as furs and jewelry are covered; however there are typically dollar limits in the event they are stolen. Typically, consumers are covered in the range of $1,000 to $2,000 for all of their jewelry and furs. In order to insure these items to their full value, individuals should acquire a special personal property endorsement or floater and insure the item to its appraised value.

When it comes to liability protection, this covers individuals against lawsuits as they relate to bodily injury or property damage that an individual or their family members cause to other individuals. It will also pay for damage caused by one’s pets.

The liability portion of an individual’s policy compensates for both the cost of defending one’s self in court and any court awards, up to the limit of one’s policy. Individuals are also covered not just at home, but worldwide.

In many cases, liability limits begin around $100,000, however, experts advise individuals to acquire a minimum $300,000 worth of protection. Typically, umbrella policies range from $200 to $350 for $1 million of added liability coverage.

An individual policy also offers no-fault medical coverage, whereby in the event a neighbor or friend is injured in one’s home; all she or he has to do is submit medical bills to the policyholder’s insurer. Individuals can typically receive from $1,000 to $5,000 worth of protection. Keep in mind; it does not pay the medical bills for one’s family or their pet.

Finally, additional living expenses compensate the individual who is living away from the residence due to damage from a fire or other insured disaster.

The protection includes things such as restaurant meals, hotel bills, and other expenses while the residence is being reconstructed. A fair number of policies offer coverage for approximately 20 percent of the insurance on one’s home. Individuals can add to the coverage, however, for an added premium. Some insurers will sell a policy that offers an unlimited amount of loss-of-use coverage; but for a period of time only.

For those individuals who rent out a portion of their home, the coverage also reimburses them for the rent they would have gathered from their tenant if the residence had not been destroyed.