Covering The Basics Of Homeowners Insurance

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In a previous career, I owned an insurance agency.

That was a while ago and no doubt policy terms have changed, however, navigating all the options for homeowners insurance can be a challenge without the help of a knowledgeable insurance agent.

Standard homeowners policies normally cover basic damages such as burglary and destruction to the home caused by fire, lightning, ice, snow and frozen pipes.

In the last few years, we have seen two large claims paid in Pine and Strawberry during the colder months due to frozen fire sprinkler lines that ruptured in the ceilings of the homes.

Most lenders will require at least a basic homeowners insurance policy to be in place before granting a loan and closing on the property.

Many homeowners are not aware that there are two kinds of policies available to insure their home and belongings.

You may choose an actual cash value policy or a replacement cost policy.

In the event of a loss, actual cash value would pay the amount to repair your home and replace your belongings after depreciation is figured in.

A replacement cost policy would repair the home with materials of like kind and purchase new contents for the home without deducting for depreciation.

Naturally, a replacement cost policy would have a higher premium, but is probably well worth the money in the event of a disaster.

In addition, most homeowners policies come with at least $100,000 in liability coverage.

This would cover medical claims or legal damages should the homeowner be named in a lawsuit.

Many homeowners choose to buy an additional liability policy called an umbrella policy, which may lift their liability coverage to $1 million or more.

According to the National Flood Insurance Program, flooding is the most common natural disaster in the U.S.

Flooding is typically not covered in traditional homeowners insurance policies.

If you suspect your property may be in a floodplain, you may request from Gila County, free of charge, a floodplain status report.

It is important to note that flood plain maps have been revised and some properties may now be in flood areas that were not previously.

Every homeowner should have an itemized inventory of the contents of their home in case of disaster should they have to submit a claim.

We make it a rule to video tape the contents of each room in our home every year and put it in a safety deposit box.

This would eliminate any question with an insurance adjuster as to our belongings should we have to make a claim.

Ray Pugel is a designated broker with the firm Coldwell Banker Bishop Realty. Contact him at (928) 474-2216.

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