How much is enough? How much is too much? What kind of coverage do you need? These are all relevant questions for someone investigating their homeowner’s insurance options.
Many people believe that their homeowners insurance should reflect the value of their home but this is not true. Insurance is there to replace or repair damage caused by sudden or accidental occurrences. And, the market value of your home doesn't reflect what it would cost to repair or replace your home. What is needed to decide on the amount of coverage is a "rebuild value."
In order to get a rebuild value each insurance company has a method or calculator it uses. The estimates can be very different. Sometimes thousands of dollars different. The important part of these valuations is working with your insurance agent to be as accurate as possible when inputting the information about your home. In other words, how many square feet is it? What kind of garage does it have? What kind of flooring, windows, systems, extras, attached or detached structures, etc. The more detail you give the agent, the more accurate the valuation will be.
There are many other factors to consider when deciding on optional coverage as well. Do you have an HOA? You may need Loss Assessment coverage. Does your city have sewer and drain issues? You may need optional Sewer and Drain backup coverage. Is your home older? You may need Ordinance or Law coverage. Do you want actual value on your contents or replacement cost? Do you have high value articles that need Special Articles coverage? And, of course, what level of Liability coverage do you need? But that's a subject for another article.
You can call us at 702-562-2886 and speak to a licensed agent to answer these or any other questions you may have.
Contributed by Victoria Sutherland, Licensed Insurance Agent