Home insurance protects your home, your belongings and other assets in the event of a fire, accident, theft or other mishap. An HO-3 is a standard insurance policy, and it protects against things like falling trees and house fires. Earthquakes and floods are not covered under a standard policy, and in some areas, this extra coverage is required.
Standard policies protect against many disasters, but there are limits to the compensation you can receive. If you have valuables such as artwork or jewelry, you can purchase additional coverage for the items’ replacement value. Below is more information on Home Insurance in Fenton.
Liability coverage protects you if a visitor has an accident while in your home, and like the example mentioned before, you can buy supplemental coverage. Home insurance is not compulsory, like auto insurance, but mortgage lenders usually require it before paperwork is signed.
How Much Coverage is Needed?
Your home insurance should be sufficient to rebuild and refurnish your home if it were destroyed. Ask a homebuilder to inspect your home and give you an estimate of the cost to rebuild; that number should be a guideline for purchasing replacement coverage. Don’t forget to include details which can increase the replacement cost. Your next step is to decide what kind of coverage to buy, selecting from choices such as:
Guaranteed replacement cost: where the insurer pays to rebuild your home no matter how much it costs.
Extended coverage: it limits the payout to roughly 125% of your home’s value.
Inflation protection: it keeps your home’s insurance value in line with current market conditions.
If you get your home appraised, buy inflation protection and extended replacement insurance, you should be sufficiently protected. The appraisal offers a realistic value, and the guarantee keeps your home’s price current. The 125% offered by the replacement coverage means that you’re protected if construction costs rise faster than inflation.
Buying home insurance can be confusing, especially if you are a first time homeowner. For help selecting the home or Auto Insurance in Canton that meets your needs and your budget, call a local home insurance agent today.