Homeowners Insurance – How Much is Enough?


The actual total of homeowners insurance that you need to buy to cover your property is calculated by the cost of replacing your home. If your home is damaged or even destroyed by any type of naturally occurring disaster then the actual replacement value may not be substantial enough to cover the rebuilding costs. Construction costs are higher than when you fist bought your home and a prudent insurance applicant would be well advised to seek a higher homeowners insurance coverage than the starting costs of replacement.

Your home owner’s insurance policy can be protection for your home if it is damaged in almost any way. It can be a lifesaver in the event of theft, fire, vandalism, an explosion, or wind damage. If your home is not up to the standard to be able to live in it then you are able to use the home owner’s insurance to pay for alternative accommodation whilst your home is being repaired.

There may be some losses which are not covered by your home owner’s insurance and your insurance agent will inform you about these uncovered losses. Living in any location that is deemed as being high risk due to the high probability of natural disasters, your insurance company may send you to the government for additional protection. There are state sponsored catastrophe funds such as the Wind Pool program which may be available in your state. If you plan to move to or if you already live in a high risk state like Alabama, Texas, Florida, Mississippi, or North and South Carolina you may want to consider buying wind storm insurance.

Flood insurance is not included in most home owner’s policies. The Federal Emergency Management Agency offers flood insurance through the National Flood Insurance Program. Destruction caused by high waters or a flash flood, which means if water penetrates your home the flood insurance will cover the damages instead of home owner’s insurance. Ask if your home is in a high risk area and adjust your coverage to cover the possible flood damages.

The main idea behind home owner’s insurance is to protect the owner against loss of property for almost any reason. It is of utmost importance to review your policy on a regular basis. It is up to the homeowner to keep adequate coverage by adding coverage for improvements or remodeling or the purchase of new furnishings. Rising home prices and inflation also need to be taken into consideration. A home purchased in 1980 may be worth 3 or 4 times the original purchase price in 2008. A home built in the 70’s or 80’s might have different building codes in the 21st century. There certainly has been an increase in the cost of building materials since that time. Protecting your family’s home is one of the most important things you can do for them. To assure them and also your own self, home owner’s insurance is the best way to show everyone that your home will always be protected.

Source by Gary Milton