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Protecting Your Home
Homeowner insurance is a must, of course, if you own your home. All
homeowners realize that, but it's not always easy to determine the
right dollar amount of homeowner insurance you should have for adequate
protection.
Homeowner Insurance is designed to offer you the financial wherewithal
to rebuild if you're faced with natural or other disaster such as fire,
flood, hurricane, tornado, earthquake or terrorism. Unfortunately all
too often homeowner policyholders realize far too late that they
haven't adequate homeowner insurance coverage to help them get back to
their customary way of life.
If you have homeowner insurance, renters insurance, or insurance on
your condominium that doesn't necessarily mean that you're fully
protected from any unforeseen disaster or tragedy. Though the
percentage varies by study, third party research reports have
determined that between half and three fourths of homeowners in the
U.S. have underinsured their primary residence.
You should periodically meet with your homeowner insurance agent and
review your homeowner policy, taking into consideration the current
replacement value of your home and the goods and property covered under
your policy. Since you first purchased your homeowner insurance, your
requirements for coverage might have changed, the value of your home
most probably has increased in value, or you might have made
significant purchases and improvements that now need to be added to
your homeowner coverage.
Your homeowner insurance policy does add a small annual inflation cost
to the policy which, all things being the same, would be adequate. If,
however, you've remodeled, reheated, added on a deck , patio or pool,
or refinished your attic or basement, your house will have realized a
significant value increase. You'll almost certainly need a new
assessment so that should a disaster occur you can replace what you've
lost.
Should disaster such as tornado, floor or fire befall your home, your
homeowner policy could have a ceiling on the dollar figure they will
reimburse you. A homeowner general casualty policy, for example, that
is endorsed to replace the cost of the building, the insurance carrier
is pledged to pay up to 125 percent of the home's valuation. If, in
this example, the house is insured at $200,000, the homeowner policy
will reimburse the homeowner $250,000. If you've underinsured your home
you may end up holding the bag for the remainder of the replacement
costs.
If your home is a costly upscale property you may want to think about a
homeowner policy feature that guarantees coverage up to home
replacement value. Many insurance firms offer this upscale homeowner
policy feature.
Consider too that while your home may not have increased in value
beyond the automatically inflated homeowner policy valuation your
possessions may well have done so. You may have added expensive
electronics or furs, or may have high value personal items whose value
increases with age, such as jewelry, and coin or stamp collections.
One important money saving factor in the cost of your homeowner policy
is that most insurance carriers give 2 to 15 percent discounts on
homeowner safety and security equipment and products such as dead
bolts, grates on windows, and smoke or burglar alarms. Securing your
home, however, must take personal safety into consideration. What you
don't want to do is develop such a homeowner fortress that you cannot
escape in the event of a fire or another in-home emergency.
Burglars are most likely to avoid your home however, if you light it
up, if breaking into your home is time consuming or noisy. In fact,
homeowner research has proven that burglars do not attempt to break
into houses that would take them more than five minutes to enter.
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