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Homeowners Advice And Resource
| Buying a home is a major investment in an individual’s life. Nobody would wish that their investment goes down the drain in case of a disaster or any unlikely events such as windstorm, fire, earthquake, hurricane or a volcanic eruption. The best way to protect such investment is to purchase a homeowner’s insurance policy. |
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A homeowner insurance policy can be explained as a financial safeguard that protects the home and the homeowner against any disaster. Mentioned below are some important aspects that should be covered under a homeowner’s insurance policy.
- Structural damage to a home: Under this clause, all rebuilding or repair costs incurred due to damage caused to a property will be paid back. However, the damage should be caused only by the disasters that have been listed in the policy. Usually, disasters like earthquake and flood are not included in a homeowner’s policy and have to be purchased separately. Rebuilding cost coverage is the amount required to rebuild a home according to the construction prices in a particular area. Rebuilding cost coverage estimate should not include the purchase value of the home and the land value. The coverage amount should be estimated by simply multiplying the total area of the home with the local construction cost per square foot.
- Loss of personal valuables: Under this clause, almost 70 percent compensation is provided to the homeowner for all the possessions that have been damaged, lost or stolen due to a disaster. These possessions can include furniture, clothes and other memoirs. It is important to keep an inventory of these possessions that one wishes to cover under an insurance policy.
- Liability coverage: Any property damage or bodily injury caused by the homeowner to a third party is covered under this policy. Coverage under this policy usually starts at $100,000 and can increase depending on the damage. According to experts, it is better to have a coverage that is equal to $300,000. One good alternative is to opt for an umbrella policy that provides greater liability coverage and higher compensation limits.
- Additional living expenses: Any miscellaneous expenses including hotel bills, restaurant tabs and other purchases are covered under this policy in situations where the homeowner is required to stay elsewhere till his/her house gets repaired or rebuilt.
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