Home Insurance: Are You Putting Yourself at Risk?
Evaluating risk remains an ongoing challenge for many homeowners. Ultimately, homeowners are responsible for safeguarding their property and family members against a wide range of potential dangers. Home insurance offers a package policy, but if you fail to add the right coverage, you may be putting your property and family members in a precarious position.
The Insurance Information Institute (III) points out that a typical home insurance policy offers coverage in four areas:
- Home Structure: Protects a homeowner against property damage or destruction due to a fire, hurricane or other disasters.
- Personal Belongings: Covers a homeowner for the costs to replace any clothing, furniture and other personal items if they are stolen or destroyed during a disaster.
- Liability: Safeguards a homeowner and his or her family against bodily injury or property damage caused to others.
- Additional Living Expenses: Pays the costs associated with living away from a house if a homeowner’s property is damaged or destroyed during a disaster.
A standard home insurance policy protects a homeowner in a variety of ways. To really optimize its value, however, a property owner must establish the right coverage and coverage limits based on risk. Here are some that homeowners frequently ignore:
A homeowners’ policy provides broad coverage for theft, but it has certain limitations. If you keep antique coins, firearms, jewelry and other valuable items at home, you may want to consider additional theft protection measures.
Increasing your theft coverage limits may prove to be extremely valuable. Boosting your theft coverage will help you receive the full costs to replace your treasured belongings if they are stolen. Your home insurance premium will be higher, but it will be well worth the cost if something happens. If price is an issue, there are many cost-effective alternatives available.
For example, you can always purchase a fireproof safe to store a broad array of treasured belongings. Or, you may want to consider installing a burglar system, which may help you save up to 20 percent on your homeowners’ insurance.
Motor Vehicles and Personal Watercraft
If you own a golf cart, all-terrain vehicle (ATV) or other motor vehicles that you use for recreational purposes, you will need additional coverage to use it off your own property. Fortunately, coverage is available that provides protection against bodily injuries and property damage caused by your motor vehicle. Coverage is also offered to protect you against collision damage if you are involved in an accident where an uninsured or underinsured motorist is at fault.
In addition, personal watercraft (PWC) coverage is a must for those who own a Jet Ski, WaveRunner or Sea-Doo. PWC coverage insures you and your watercraft against accidents, liability and vandalism, making it a crucial add-on to supplement your home insurance policy.
There are several special categories that may impact your ability to secure home insurance, including:
- Dogs: Many insurance companies use lists of “bad breeds” of dogs and may require muzzling, behavioral training or other restrictions as part of your policy.
- Trampoline/Swimming Pool: Your insurer may add a “nuisance surcharge” or exclusions to your policy due to a trampoline, swimming pool or other “high-risk” items.
- Art and Collectibles: Getting your art, collectibles, and other rare valuables that are stored in your home professionally appraised allows you to protect these items if they are damaged, destroyed or stolen.
For homeowners, it is essential to understand all of the risks that may impact you, your family, house, and your personal belongings. If you learn about risk, you can use your home insurance policy to control it accordingly. Home insurance enables you to limit risk effectively, making it tremendously valuable for homeowners nationwide.
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