When you first take out your home insurance policy, you may not pay very much attention to what's included and what isn't. The process of buying a home is overwhelming enough to have to go through a policy line by line. But when you're considering your plan, you need to think about what's most important to you. We'll tell you more about how to structure a policy, so you can get a better handle on whether you have enough coverage.
No matter what type of policy you have, it's likely to cover a few basic components. For example, it should include the land, such as the yard, fence and garage, as well as the structure itself. Basic coverage will include damage from things like inclement weather and fire. No matter what carrier you choose, coverage will likely stay the same. You might not have to think more about them. However, this doesn't mean you don't need more coverage.
Policy additions are what will give your home insurance more structure. Do you need earthquake protection in your state? How much personal property coverage do you need? If you spent 100 hours restoring your heirloom furniture, do you want your home insurance to take that value into consideration? These questions allow you to account for different types of losses. Most of home insurance is thinking about what's most important to you, and then ensuring your policy spends some time on that topic.
If you tend to take a few more risks on your property, such as working with power tools in the garage, or installing a trampoline for your kids, then you need to be honest with your home insurance company. The more likely it is that something will occur, the more your home insurance policy needs to account for this. Many homeowners will pick up hobbies along the way. Some of them won't affect your premium, but others will.
Ultimately, your home insurance should reflect your priorities. If you know that your furniture is going to be relatively easy to replace, then lower possessions coverage might work. However, if you have expensive jewelry or electronics, then you might need to buy additional, expanded coverage. In the end, think carefully about what items you care about, and which items are disposable to you. It's better to plan to pay for homeowners insurance than to face an unexpected and costly loss.
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