Thanks for such an awesome tips about the home insurance. Its rely helpful. While investing in any type of home insurance every one should know about coverage provided by the policy.
Your home is likely your most valuable asset–make sure you protect it. While insurance agents will help determine the kind of coverage you can buy, it is ultimately your responsibility to know what the policy covers.
1. Review your policies annually. A walk-through of your coverage needs with your agent may identify other coverages (i.e., jewelry, artwork, etc.) that you need, as well as ways to save on premiums such as bundling auto and home insurance coverage together with one provider or requesting higher deductibles to help contain your costs.
2. Identify risks you face that are not covered by your homeowners policy. Disasters such as floods and earthquakes need a separate policy to protect your home if tragedy strikes.
3. Understand how much coverage you have. Many homeowners believe their insurance policy will replace their damaged or destroyed property regardless of the amount of damage incurred. Remember, it is not your home’s market value that is covered, but rather its replacement cost. Home additions and major kitchen or bath remodeling projects can add significant value to your home, which may not be covered by your current policy. It is important to that your coverage is sufficient, based on your home’s replacement cost.
4. Do your homework when shopping for price. Get quotes from different carriers. Since rates can vary, make sure you compare coverage on an apples-to-apples basis so you realize when a lower price really represents less coverage. Consider higher deductibles to help contain your costs or ask if discounts are available for installed safety and security devices such as smoke detectors and alarms.
5. Research carrier performance. Ask your friends and neighbors for references.Also research the financial strength of carriers through independent third-party sources such as state insurance departments, A.M. Best, Standard & Poor’s, and customer satisfaction ratings at the J.D. Power Consumer Center.
Source: J.D. Power and Associates 2006 Homeowners Insurance StudySM
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About the Author: Jeremy Vohwinkle is a Chartered Retirement Planning Counselor® and spent a few years working as a financial planner. Today, he helps people make the most of their money by writing about personal finance here and elsewhere on the web. Jeremy is also Coach at Adaptu and a regular contributor for other publications such as Intuit, and American Express. Be sure to follow Jeremy on Twitter or Google+.
That is a great idea, and actually a co-worker of mine did that last year. He took a video of every room of their house, highlighting their belongings and then put the tape in a safe deposit box at the bank.
And I can certainly see where this could mean a tremendous additional claim. We all own so many things it is impossible to remember everything or what model or brand it was if they were to completely disappear. A video log will be sure to make sure you recover the most possible in the event of a disaster.
I would add one more. Walk around your house, inside and out, and videotape your residence and the belongings inside of it. Then store this tape somewhere away from your home, such as a safety deposit box.
In the event of a major disaster to your home, this form of documentation can increase the amount of money your insurance company pays you in claims. I heard of a case in California where this increased the claim amount paid by 20%.