Five Tips For Purchasing Homeowner’s Insurance
The purpose of homeowner’s insurance is to protect against damage and loss. When you have home insurance, you don’t need to worry about expenses should disaster strike. Some policies cover just the damages caused by a calamity, and others may cover the entire cost of your home.
However, like any investment, insurance policies can be tricky. Besides reading the fine print, you also need to understand a couple of things about a home insurance policy before you agree to purchase it. Lack of awareness about specific elements in a policy can lead to half-met expectations or additional expenses that you haven’t planned for. To prevent this from happening to you, S C Glenn Insurance & Associates Inc. has put together a list of five tips to make sure you are on track when purchasing a homeowner’s insurance policy.
Tip #1: Replacement cost value (RCV)
RCV is the cost of replacing your current property with a new one. It does not account for depreciation deductions, which means the insurance company offering this coverage will pay you enough to replace the damaged property with a new one of similar features and qualities. With this type of coverage, you do not have to pay more than your deductible in the event of damage.
Tip #2: Actual cash value of your personal property
An insurance coverage that offers the actual value of your personal property will pay you the real worth of your property today. The actual value is determined by subtracting depreciation from the amount at which the property was purchased. With this type of coverage, you will need to put in more than the deductible amount in case of loss.
Tip #3: Understanding your home insurance deductible
A homeowners insurance deductible is an agreed amount, that is deducted from a covered loss by the insurance company at the time of claim settlement. For example: In the event of a total loss, if the value of your house is $100,000 and you agree to a deductible of $10,000 the insurance company will pay out $90,000 to settle the claim. If the covered loss is less than $10,000, you will unfortunately incur the expense for your own loss. Typically, the higher your deductible, the lower your premium; and the lower your deductible the higher your premium.
Tip #4: Exclusions, know what’s not covered
Usually, an insurance policy lists the things that are not covered. These exclusions should be given careful consideration before committing to a policy. A typical homeowner insurance policy excludes damage caused by natural calamities like floods, hurricanes, or earth movements. Losses caused by power failure, war, nuclear attacks, pollution, and the enforcement of building codes are usually excluded as well.
Tip #5: What supplemental policies do you need
Supplemental policies or optional coverages provide additional insurance which you can purchase to cover expenses that regular homeowner insurance does not cover. These Optional Coveages are designed to cover damage typically excluded under a traditional home policy.
S C Glenn Insurance & Associates Inc. is the best at providing affordable auto, life, and other insurances in Atlanta, Georgia, Alabama. We form strong relationships with you, evaluate your present and future protection needs to offer you the most competitive rate available across the states of Georgia, Alabama, North Carolina, Indiana, Illinois, Maryland, and Washington DC. You cannot control things that happen to you, but you can prepare for them. We aim to help you prepare with the right backup plan available at a rate you are comfortable paying.
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