Home Insurance Coverages that Should Never Be Sacrificed to Save Money
The current homeowner’s market has been painful. As insurance agents we spend the majority of our time quoting policies that have seen soaring prices. We also see many quotes and policies from other agencies that don’t provide adequate coverage in an attempt to save a couple hundred dollars annually. We all want to get you the best rate, but there are some coverages that should never be sacrificed.
We want all of our neighbors to know what their minimum coverage should include so you don’t get cheated by someone who doesn’t your best interest at heart. In order of importance, you should review these coverages on your home insurance policy:
- Make sure you home is covered for Replacement Cost and NOT Actual Cash Value. Replacement cost is the amount it would take a rebuild in the current economy, up to the policy limit. Actual Cash Value depreciates the value of property to account for time, which means it is always much less than Replacement Cost and will likely not be enough to cover the amount for a new roof or new house.
- Hurricane Deductible should be less than 10%. Hurricane deductibles are the amount you will have to pay if you place a claim. It’s a percentage of your total home value, not the claim amount. If you have a 5% deductible on a $500,000 property, you’ll be paying $25,000 for a roof claim, which is about the same cost of buying your own roof. We typically shoot for 2-3% wind deductible.
- Liability Limits should be over the $100,000 minimum that companies set. Liability coverages pay for any injuries or damages of others. In a time of rising medical costs, $100,000 may not be enough. Especially if you have a pool and there’s a risk of drowning, please raise your rates to at least $300,000.
- Did you know your insurance will pay for your lodging if you must be relocated from your home? Loss of Use covers hotel stays and lost income in you have a rental home. It doesn’t cost much to increase this amount, so think of how many thousands you can save by keeping it in the event there’s damage. Since it’s buried in the coverages, it’s often overlooked.
After reviewing these coverages, take a quick look at your policy and see if any of these tips apply. If you want a quote with one of the many companies that we have access to, give us a call at 850-244-1574 or submit a quote online at www.norton-insurance.com.