Did you know that 1 in 15 insured homes has a claim each year?
Yes, according to the insurance information institute, it’s only a matter of time before it’s your turn to file a home insurance claim. Wind, hail, water damage, freezing, theft, fire and lightning are just a few of the common culprits. Now tack on the probability of a liability claim or lawsuit being filed against you or a family member, and the likelihood of your home insurance staying on the bench forever is slim.
Following is our handy checklist to be sure your homeowners insurance policy adequately protects you. Review these with your family and your Trusted Choice Independent Insurance Agent (First Lakes Insurance Agency for example) before you are the one with a claim.
- Know the difference between reconstruction cost and replacement cost. The limit of insurance carried on your home should be based on its reconstruction cost.
- Check your limits at least annually. It’s estimated that 60% of homes are underinsured and with values of home increasing the past year, it is smart to check on this with your agent.
- Don’t forget about your possessions. Ensure that your personal property inside your home is covered at replacement instead of actual cash value.
- Improve your insurance if you have improved your home. A new deck or bathroom increases your home value.
- Take inventory. A digital inventory of your home will be your best friend at claim time.
- Flood insurance. Flood damage is not covered by your home insurance, talk to your agent about whether you need flood insurance.
- Insure the cost of required building code upgrades. (such as upgraded electrical wiring).
- Insure your “other” structures. Talk to your agent to determine the other structure and coverages.
- Install a home security system and tell your insurer about it. You may qualify for a credit.
- Know your deductible, especially if it varies based on the type of damage. For example, your policy may have a $500 deductible for most losses but a higher deductible for wind damage.
- You can raise your deductibles and save money. This is a tried and true way to cut the cost of your insurance… but only do it if you can handle the cost of the higher deductible.
- If it has a motor and a driver’s seat, you may want to ensure it separately. Ask your agent about adequately insuring riding mowers, golf carts, personal watercraft even a mobility scooter.
- Check your limits on liability. Statistically, most home insurance claims are for property damage but a liability claim can quickly ruin your family’s financial future. For example, a liability claim could result if a person is injured in your home. A basic liability limit (such as $300,0000) is often easily increased to $1 million or more for little money.
- Review your personal umbrella insurance policy to ensure it will kick in if your home insurance policy is wiped out by a liability claim or won’t pay enough due to limited coverage.
- If you have a home based business and are unsure if your business activities are covered by your insurance policy, be sure to ask your agent… today.
- Renting your home? Tell your insurer, payment of claims that occur during the time that you rent out your home may be limited by your insurer. Just Ask Us at First Lakes Insurance to help you with this circumstance.
Reviewing your home insurance policy today with your Trusted Choice Independent Insurance Agent at First Lakes can help ensure you’ll be ready when the day comes that you have a claim.