Hurricanes and Home Insurance Policy: What Irene Taught Us
Last month, HurricaneIrene swept across the east coast of the United States with gale force winds and flooding tropical rains. Like many, I sat by the window watching the storm whip the neighborhood trees and power lines into a frenzy, causing widespread damage.
When I noticed a large tree limb had fallen onto my neighbor’s garage, I instantly thought about my own insurance policy. What coverage did I have if my house or garage were damaged?
Most people don’t understand the coverage they have on their policy until they have to file a claim. At that point, it may be too late.
Here are the parts of every homeowner’s insurance policy you should be cognizant of:
Also known as “Coverage A” on your policy, dwelling coverage is the amount of money your policy will pay to rebuild your home if it is destroyed. Find out if you have enough by asking an insurance agent do a free replacement cost estimate on your home.
This is the amount of money your policy will pay to rebuild other structures on your property besides the house, such as a detached garage, shed, fence, or patio if it is damaged.
Also known as “Coverage C” on your policy, is the amount of money you have to replace all of your “stuff” in the event of a loss. Envision taking your house and tipping it upside down, anything that falls out is your “stuff,” i.e. clothes, electronics, appliances, furniture. Think about your house and all of your “stuff,” how much would you need to replace it all?
In the event that you become a defendant in a lawsuit, you insurance company provides personal liability protection. This should not be lower than $500K. For example, if your mailman is permanently disabled by an accident on your property and sues you for $400K, your policy would cover that amount. If you own more than one home and more than one auto, this figure should be $1 Million.
There are many optional endorsements that you can add to your policy that will cover you for identity fraud, sewer & sump pump backup, food spoilage, watercraft, jewelry, silverware, fine china, artwork, personal injury, tree removal, lock replacement, fire dept service charge, and many more. You should have your insurance agent add the proper endorsements that best suit your lifestyle.