While homeowners insurance isn’t mandatory, having it ensures you can recover your home and personal belongings if damaged or lost in a covered peril. Still, mortgage companies won’t lend to you if you don’t have this coverage. Here are some important facts you should understand about homeowners insurance.
How Much Home Insurance Coverage Do You Need?
The underwriting process, which includes property inspection, determines the amount of coverage you need and how much it may cost you. If you’re insured for your property’s replacement cost, then your policy can pay to rebuild your damaged home or replace lost personal properties if a covered event occurs.
Note that the replacement cost for which you’re covered by insurance is usually less than your home’s purchase price. That’s because you won’t need to replace the piece of land on which your house is built after fire or storm damage.
Is Renters Insurance Worth Having?
Your landlord’s home insurance policy doesn’t cover your own personal property for theft or damage. It also won’t protect you against third-party liability claims. Renters insurance can cover you for these perils if you live in a rented apartment.
Which Disasters Are Covered by Homeowners Insurance?
A standard policy can pay to replace or repair damage to the structure of your home up to the dwelling limit. The payment is also subject to a deductible. Covered hazards include:
- Theft (under the personal property component)
Are There Additional Coverage Items in a Typical Policy?
Your homeowners policy can also cover extra items like:
- Structures on the property not directly attached to the main dwelling
- Your personal property, such as furniture and clothing
- Additional living expenses forced by damage to your home
- Third-party injury claims and lawsuits if you’re liable
Does a Standard Policy Cover Flood Damage?
Your home insurance or renters insurance policy won’t cover flood damage. You should obtain a separate flood insurance coverage if you live in a flood-prone area.
It’s important to keep these homeowners insurance facts in mind as you consider obtaining your own coverage. To learn more about home or renters policies, contact the team at Steve Wilk Insurance Agency Inc. today. You’re always welcome to visit us at 310 S Main Street, Suite C, Lombard, IL 60148.