Homeowner's Insurance

By
Real Estate Broker/Owner with Archwood Properties

It's quite a debate to decide if you're appropriately insured for your property and personal possessions.  In the event of a devastating loss, you don't want to have a policy that won't assist in getting you back to your routine lifestyle, but on the other hand, you don't want to throw money away in policy premiums each year if you won't need it all.  How do you get just the right amount of coverage?

Most agent recommend opting for  replacement cost coverage rather than cash value coverage.  This way, the insurance company will cover the expenses of replacing damaging property, rather than just giving you the value of the loss.  If you have a to rebuild a home due to a fire, a cash value policy will only give you enough money to reimburse you for your 10 year old windows, roof or doors.  The replacement policy understands that while your property may have depreciated and you've gotten great use of it, it will still take money out of your pocket to pay today's prices.  One thing to remember with replacement coverage is to get a policy big enough to cover the entire rebuild of your house, purchase of furnishings and personal property and the land value of your property.  Market value will sell you short of where you need to be in the event of a complete loss. 

Additionally, another oversight is the construction costs of rebuilding.  Sure you may have factored in the supply costs of every single item in your home, light switches and all, but did you remember to factor in how much you have to pay someone to do the work?  If you have a recently purchased home, you know a round-about figure to give your insurance agent when decided on a policy, but if it's an older home, get a few bids from local builders before nailing down a policy. 

Adjusting your policy as things change within your home is another crucial aspect.  If you do a remodeling project that is 5% of the homes value, or $5,000 (whichever is less) adjust your policy to cover your upgrades.  I mean, you aren't putting money in the house for nothing, right?  Adjustments can be in terms of added personal property too.  If you have more expensive furniture, clothing or jewelry, make sure your policy covers that as well. The amount of additional coverage will literally only cost you pennies on the dollar in premiums compared to what it actually costs to replace. 

Any loss can be devastating and a long-lasting headache, but having complete coverage will at least minimize your chaos. 

 

Contact us today: 214.923.0261 or email us: info@archwoodproperties.com 

www.archwoodproperties.com

  

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