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Common Homeowners Insurance questions: What you should know?

Below are some of the most common Homeowners insurance questions to help you better understand.

1. What is Homeowners insurance?

A Homeowners insurance is a form of property and casualty insurance. It can protect your home against damages that occur to the house itself and the belongings inside.

2. What does homeowners insurance cover?

Most basic Homeowner’s insurance policies cover the cost to repair or rebuild due to damage caused by events like: fire, hail, lightning, windstorm, theft or vandalism. While other hazards, such as floods and earthquakes are not typically covered by standard policies, you can get coverage for them, usually separately. In fact, if you live in a flood zone, you need to buy flood insurance to get a mortgage. Federally regulated lenders are legally required to make people living in high-risk flood areas buy a policy.

Homeowners insurance also protect your possessions inside the home like clothes, furniture, and electronics.

3. Is homeowners insurance required by law?

No. Homeowners insurance is not required by state law like auto insurance. But if you're financing a house, your mortgage lender will likely require you to get some. Having home insurance is an important way of protecting your home and belongings from the unknown and potentially avoid paying out of pocket for costly damages.

4. Why do I need homeowners insurance?

When it comes to your biggest investment, your home, you can’t afford to go without insurance. Losing your home in a catastrophic event like a fire or tornado would be a nightmare. The last thing you want is to realize you don’t have the money to repair or rebuild your home.

5. Homeowners insurance will replace my house if it's destroyed?

Here's the short answer: If your house is destroyed by a covered event, a standard homeowners policy will go a long way toward repairing or rebuilding your home.

6. What types of homeowners insurance policies are there?

There are two big ones we are referencing here:

  • A replacement cost homeowners insurance policy pays claims based on the cost of rebuilding or repairing your home at the time it is damaged or destroyed.

  • An actual cash value homeowners insurance policy pays claims after accounting for any depreciation in your home's value.

7. Which one is better?

Replacement cost homeowners insurance will cover more damage to your property and possessions. Actual cash value homeowners insurance is cheaper, but it usually won't pay out enough to fully repair or rebuild a damaged home.

8. How much Homeowners insurance do I need?

It really depends on how much home you are buying, where you are buying it, the condition of your property and how many belongings you have.

10. How many belongings I have?

Yes, because homeowners insurance provides coverage for your possessions, too, just like renters insurance. You'll have a total coverage limit for personal belongings and individual limits for high-priced items, like jewelry. The rule of replacement cost vs. actual cash value insurance also applies.

11. How do I complete a home inventory?

When you purchase a home and a homeowners insurance policy, you should create an up-to-date home inventory to expedite a claim settlement if you ever need to make one. With a complete home inventory, your insurance company can verify property easier, which makes settling your claim easier.

Start your home inventory by making a list of your possessions, describing each item and noting the make/model, date and where each item was purchased. Include sales receipts, purchase contracts and appraisals if you have them, too. Organize clothing into categories for easier reference.

12. What else does homeowners insurance cover?

In addition to property and personal belongings damage, standard homeowners insurance covers liability in the event someone injures themselves at or around your house and loss of use, in other words, it'll pay for temporary housing while your house is in repair. Separate coverage limits apply to each category.

13. What is liability coverage?

The liability portion of your homeowners insurance kicks in if someone is accidentally injured on or around your property. Say they slip on an icy sidewalk or your dog bites them. So long as there are no exclusions (which is possible, particularly with certain dog breeds), liability insurance will pay for that person's medical expenses and any court costs you incur if they sue. Liability insurance also covers property damage caused unintentionally by you or your family members, like if your kid breaks a neighbor's window while playing catch in your yard.

14. What about liability limits?

Liability limits start at $100,000, but most homeowners should have between $300,000 and $500,000 worth of liability coverage to protects their assets in the event of a lawsuit.

15. How can I lower the cost of homeowners insurance?

You can opt for a higher deductible (that's the amount of money you'll have to pay out of pocket before your insurance kicks in), but less risky ways to save include bundling your homeowners insurance, usually with your car insurance or asking if you qualify for any discounts.

16. What homeowners insurance discounts are there?

Sometimes homeowners insurance companies offer lower rates to first-time homeowners or first-time customers. You might also score a more affordable policy by adding certain security features to your home like an alarm system, impact windows or shutters, new roof.

17. What's an umbrella policy?

Umbrella policies offer extra liability coverage on top of what's already covered by your standard homeowners insurance or car insurance policy. Umbrella coverage starts at $1 million. You should also consider umbrella coverage if you're at risk of multiple lawsuits, like if you have a few teen drivers in the house or you own multiple properties, especially rentals.

To request a quote, you can get in touch with us or go online:

· Phone/WhatsApp: (561) 672-7897

Simplified Insurance Agency – Insurance Made Simple

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