Are you covered in the event of a loss?
If you’ve ever filed a claim you know that the most frustrating thing a claims adjuster can tell you is “Your policy doesn’t cover that.” The easiest way to avoid that situation is to review your policy now, before you have a loss.
If the limits of your policy have not changed since you bought your home, you’re probably under insured. By now we’re all familiar with the rise in housing and construction costs. This increase in costs may mean that you need to adjust your policy limits. The dollar amount listed under Coverage A is based on how much it would cost to rebuild your house from the ground up, not the price you would sell it for today. Coverage A should be 100 percent of the home’s replacement value. If you have less coverage, you may not be fully reimbursed for damage.
Review and understand the deductibles on your policy. Hurricane deductibles exists in 18 states and is often a percentage of the insured value of the home. For instance, if the amount under Coverage A is $200,000 and your policy lists a 2 percent hurricane deductible, you are responsible for $4,000 of the damages and your insurance carrier is responsible for the rest. If you live near the Atlantic or Gulf coasts, there may be some restrictions on your coverage for wind damage. Ask us about windstorm deductibles.
Check the dollar limits on insurance in your policy and make sure you are comfortable with the amount you have for specific items. Homeowners policies do provide coverage for valuables, up to certain limits. For maximum protection you should have jewelry, furs, silverware, art, and other valuables appraised, then scheduled separately to your policy. You’ll get the broadest coverage possible, with no deductible.
Do you have flood insurance? Flood coverage is not provided under your homeowners policy and if you live in Florida, you live in a flood zone. All properties are located in either a mandatory flood zone or preferred flood zone. In a mandatory zone the mortgage lender will require flood insurance. If your home is located in a preferred flood zone, coverage is not required but strongly recommended and you will qualify for lower, preferred rates. Unfortunately, 30 percent of all flood losses occur in preferred zones, so low risk does not translate to no risk.
