Homeowners’ insurance can be fairly simple to understand if you read the fine print. Many people, however, don’t take the time to read the fine print and can sometimes make costly mistakes because of it. It’s important to know what your policy includes and what it doesn’t. A homeowners insurance policy isn’t something you should buy and stick in a drawer somewhere. It needs to be reviewed periodically. Life events happen, and that can make your policy obsolete in a matter of months. Don’t risk losing your home or belongings because you made a simple mistake.

Know the Perils That Are Covered

Homeowners’ policies can be fairly basic and only cover a few common perils. Other, more expensive policies may cover as many as 16 perils, including tornado damage and damage caused by frozen pipes. Make sure you know the perils that are covered and those that are not. If you want a specific peril added to your policy, you may have to add a rider to make sure you are sufficiently covered. Take a few minutes and talk to your insurance agent and have them explain your policy perils to you.

Don’t Forget Loss of Use or ALE

Many people don’t realize that their homeowners’ policy covers loss of use or ALE (alternative living expenses). This means you will get money to find a place to live until you can return to your home. While many types of damage can be fixed in just a few days, it may take a few weeks if the damage to your home is extensive. Loss of use is included in most policies so that you won’t have to worry about where you will stay if your home is uninhabitable after a catastrophic event.

Certain Natural Disasters Aren’t Covered

Certain natural disasters aren’t covered by most homeowners insurance policies. That is because these natural disasters don’t occur everywhere. Hurricanes and earthquakes commonly will only occur near a coastal area. While floods can occur almost anywhere in the country, they are primarily confined to low-lying places or areas that are part of what is known as a floodplain. Not everyone will need to buy these types of insurance policies, so they are sold as riders that can be purchased if they are needed.

Your Deductible Will Come Out-of-Pocket

Deductibles are part of almost every type of insurance policy. Deductibles must be paid first, with the money coming out of your own pocket. If you choose to pay more out of pocket, your premiums will be much lower each month. If you want to pay less out of pocket, you will pay higher monthly premiums. This is often a personal choice and will depend on your budget and how much money you may be able to come up with in case of an emergency.

When you buy a homeowners insurance policy, it’s important that you try and avoid common mistakes. Always read the fine print and discuss your options with your insurance agent. Contact the agents at the Steve Wilk Insurance Agency LLC to schedule an appointment as soon as you can. Our agents will make sure to point out any mistakes and help you avoid any potential problems with your coverage. Visit the office at their new location at 310 S. Main Street, Suite C, Lombard, IL 60148.