For most of us, purchasing a home is the biggest investment of our lives. Taking possession of your home is more than just taking over property or long-term investment; it is often the payoff of a lifetime of hard work so we understand that your home is more than just wood and concrete. It is the place we raise our families, the dining rooms in which we gather, and the warm memories we reminisce fondly of as the years pass.
So what is keeping our homes safe from the unexpected? There are some things in life we just can’t prepare for. Do you know who to call if your washing machine floods? In the event of a house fire, where will you go? Having the correct home insurance in place can mean the difference between inconvenience and disaster when issues arise.
Purchasing home insurance can be a confusing process to navigate. In this article, I will break down what homeowners insurance is and the advantages of having homeowners insurance coverage in place. I will also explain some simple ways to ensure you are optimizing the coverage available to you.
What is homeowners insurance?
First things first, let’s get a clear understanding of what exactly home insurance is.
Homeowners insurance is a type of residential insurance that provides coverage to repair or rebuild your home after the occurrence of events such as fire, smoke, theft, vandalism, or damage caused by weather such as lightning, wind, or hail, etc. Most typical insurance policies will also cover personal belongings such as furniture, clothing, and other possessions.
Furthermore, a standard homeowners insurance policy will also offer coverage for other detached structures on your property, additional living expenses should you be displaced, and personal liability exposures in the event that people other than you, your family, or anyone else not living in your home is injured while on your property.
When you purchase a homeowners insurance policy, you’re in essence buying a safety net for your home. If your home is damaged or destroyed, it can cost hundreds of thousands of dollars–to repair or rebuild.
Without having an active homeowners insurance policy, the money needed to repair or rebuild your home would have to come out of your pocket. But if you’re insured – and the damage is covered by your policy, you can file a claim to pay for the damage and help rebuild your dream.
Should you actually experience a loss, whether from fire, severe storm, a burglary or another covered peril, simply call one of our insurance agents or the insurance company directly to initiate the claims process? An adjuster will then be assigned to your file and will work with you to assess the damage and determine your compensation.
What does homeowners insurance protect?
If your home and any attached structures, like a deck or garage, are damaged by a covered peril, your homeowners policy helps pay for the repairs. The amount of dwelling coverage you need is usually calculated by the square footage of your house and what it would cost to rebuild your home. This is done through industry-standard property valuation tools.
Personal property coverage helps pay to replace certain belongings, such as clothing, furniture electronics, and other personal items, that are stolen or damaged by a covered claim.
If you or a family member are found legally responsible for accidentally damaging someone else’s property or injuring someone, this part of your policy will help pay for related repair costs and any associated legal fees.
Additional Living Expenses Coverage
If you cannot stay in your home after a massive weather occurrence or another covered claim, your homeowners insurance coverage may help pay for additional living costs, such as the costs of renting another place as well as related food & beverage costs.
Other Structures / Outbuildings
This section of your policy helps pay for repairs or replacement of detached structures on your property, like a fence or detached garage, in the event that they are damaged.
What are the advantages of having homeowners insurance?
To simplify, some of the benefits of having a homeowners insurance policy in place then can be summarized as:
- Physical Protection from natural disasters
- Reimbursement for property in the event of theft
- Ensuring your home properly restored in the event of a claim
- Peace of mind
Let’s have a closer look at each of these.
Protection from natural disaster
It’s easy to assume natural disasters won’t affect you. However, being underprepared when they do strike can make an already stressful situation devastating. Ensuring you have adequate coverage for the natural disasters that are the highest risk for your area is essential to protecting your assets.
Take earthquakes, for example, they can leave your home uninhabitable. If this were the case, would you have the means necessary to find new shelter? Replace all your belongings? What about the cost to restore or rebuild your home? Natural disasters can leave you displaced from your home for months at a time. If the disaster is severe enough you may even need to relocate. Homeowners insurance is there to help with the cost to rebuild or restore your home, as well as cover the cost you may face if you were forced to live elsewhere for a period of time.
Finding a rental property while waiting for your home to be restored is also a large cost that many don’t consider. Your insurance will cover the cost of your rent while you are displaced and waiting to return home. It is important to also take into account the emotional toll keeping up with these costs can take on you while dealing with an already draining situation. The minimal cost of insurance can prevent you from the stress of suffering a large financial loss due to a natural disaster.
Reimbursement for lost or theft of property
Homes are undoubtedly one of the biggest purchases we will ever make. However, the cost of replacing the things we fill them with can add up fast. Curating a life and home full of your passions and interests can be a costly process and having an adequate content limit for your insurance means that you don’t have to worry if something is lost or stolen.
In the case of theft, you can often be left at a loss for many big-ticket items all at once. With no coverage in place, you would need to make the difficult decision of deciding between repurchasing many expensive items at once or going without them. Imagine returning home to find your home has been broken into.
Look around your home, if something were to be stolen would you feel financially comfortable replacing it? Things like televisions, computers, and jewelry can add to major expenses. Even if you could afford the amount, why pay? The cost of an annual policy is much cheaper than replacing the contents of your home in the event of a loss.
Ensuring your home is properly restored
Unexpected events are just that, unexpected. Things like a leaking dishwasher or broken pipe can cause havoc in your home. In an event like that would you know what to do? For most of us, an event like this leaves us wondering. Having insurance means you have someone to call to advise you on what to do. By having an insurance provider at your disposal they are able to deploy professionals with a proven track record immediately.
For many of us, we don’t have a deep list of contacts that specialize in home damage. So choosing a team to restore your home can be a risky and stressful process. Your insurance provider deals with many claims frequently and will have a long list of teams with a proven track record in whatever loss you are experiencing. Even minor water damage can end up causing major long-term damage and affect the value of your home down the road. By putting home insurance in place you are putting a team of experienced professionals to keep your home and investment safe.
Offering peace of mind
Nobody wants to think about things like earthquakes, break-ins, and fire and water damage. But unfortunately, they are a reality of the world we live in. Your home insurance policy can offer you not only financial reimbursement but guidance in the difficult time of a loss. Experiencing these events can be stressful, often leaving people with the question what now?
With coverage in place, you have access to an experienced team who can guide you when dealing with damage to your property, return home as soon as possible, and get back to life as usual. Letting your insurance provider handle the ‘what’s next can give you the comfort of knowing you’re taken care of so that you are focused on getting life back to normal.