How Much Home Insurance is Enough?

How Much Home Insurance is Enough?

The cost to rebuild your home is its replacement value. This can be very different from the actual purchase price or the estimated market value. In most cases, it costs more to rebuild the home you own than to buy a new one. 

GEORGIA Homeowners - How much home insurance is right for you?

Based in Woodstock, GA, Shaw Insurance & Associates, Inc. understands the home insurance needs of our clients. We’ll work with you to estimate the replacement cost for your home and to adjust your policy limits from time to time as needed.

It is important that you provide us with accurate, updated information about the details of your home and its contents. 

It is also a good idea to reexamine your coverages and limits annually, especially whenever you make additions or improvements. Shaw Insurance & Associates, Inc. can help you re-evaluate your insurance needs, just give us a call at 770-479-0985 to speak with one of our agents. 

GEORGIA Homeowners- Be Sure You Have Enough Homeowners Insurance

Here are some steps you can take to reduce the danger of being seriously underinsured:

1. Call Shaw Insurance & Associates, Inc. If you have questions or concerns about the limits in your policy, ask us to show you how those amounts were calculated. This will also give you an opportunity to make us aware of any overlooked information.
   
2. Read your policy. Certain property, such as high value jewelry, and certain perils, such as earthquake or flood, is usually insured separately. Knowing what is covered and for what amount will help you insure properly. If there is anything in your policy you don’t understand, call Shaw Insurance & Associates, Inc. at 770-479-0985 and ask for an explanation.
   
3. Review. At each annual renewal of your policy, you receive a new Policy Declarations page showing limits of coverage and optional coverages. Review this information. If you have completed any significant remodeling, such as adding a family room, finishing your basement or adding a bathroom, etc., tell us about these changes so your coverage limits can be adjusted to cover the improvement. The replacement cost of your home is based on the cost to rebuild your home with today’s labor and material costs.
   
4. Consider carefully whether your policy provides all the protection you need. Does it provide coverage for extra costs resulting from building code changes? Does it automatically increase coverage limits annually to keep pace with inflation? Has the cost of the building materials and labor costs effected the cost to rebuild your home, and is your insurance policy keeping up with those costs? Does the policy provide an extended replacement cost coverage if the amount needed to rebuild your home exceeds the policy limits?

Make sure you know:

Does your policy include replacement cost coverage for contents (clothing, furniture, appliances, and other personal property inside your home)? If not, you can add it by endorsement. The cost is small, the protection valuable. Replacement Cost Coverage pays for losses to your possessions at the cost of brand-new items. Without this option, a covered loss to your personal possessions would be depreciated by their age and condition.

If you have an art collection, jewelry, or other valuable possessions, talk to your agent about supplemental coverages, such as fine arts or scheduled property endorsements, to adequately protect your investment in these items. The cost is modest for the extra protection, and often the deductible is waived.

Consider whether you should have more coverage for personal property (contents) than your policy provides. Personal property coverage is usually 50% of the coverage limit for the structure. Supplemental protection is available for a small additional premium. 

Inventory your home. Prepare an inventory of personal property items, update it periodically, and keep it in a safe place outside your home, such as a safe deposit box or digitally off site. It will save you hours of time trying to list everything damaged or destroyed if you need to make a claim. It will also help ensure you don’t forget some items. Shaw Insurance & Associates, Inc. can advise you on ways to simplify the job of preparing a personal property inventory such as videotaping each room with descriptive information on the audio. Also taking photos of receipts of new purchases as documentation and storing them in a safe deposit box or digitally off site in the event of a loss.

Personal Liability

Besides making sure you have enough protection to cover possible damage to your own home and contents, you should also evaluate your exposure to liability risks. These result from damage to the property of others, or injury to a person (not a member of your household) for which you can be responsible. 

In recent years it’s become common for homeowners to be sued for injuries or damages to others, even when there is no evidence of negligence by the homeowner. The reality today is if you have assets, you are exposed to the risk of being sued. Even if you ultimately prevail in court, your legal fees and the months or years of worry and uncertainty can be a terrible burden on you and your family. 

The Personal Liability coverage provided by your Homeowners Policy usually provides a limit of $100,000 to $500,000. If you worry if your liability limits are enough, you can increase this protection with a personal umbrella policy. Not only will it increase your personal liability, but also your auto liability. Limits are available from $1 million to $10 million and beyond. The cost of this coverage is usually very reasonable. Umbrella policies require a certain amount of underlying liability limits on your auto, home, and other policies.

The right coverage amount is unique to you – talk to Shaw Insurance & Associates, Inc. today to find out how to get the best price and value on home insurance for you.

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