Home Insurance Coverage

Home Insurance Coverage

Figuring out the right home insurance policy can be very tricky, especially as things change in the insurance world over time. There are many different types of coverage, each offering different security to your home and property. It’s important to know what you are buying, how much it will cost and what it will cover before you make any purchase for your home. Here is a guide to finding the best home insurance coverage for your needs.

While there are many different types and levels of homeowners insurance available on the market, there are three very common policies. They basically fall into categories of “basic”, “moderate” and “high” levels of coverage.

Basic Home Insurance

This type of insurance is a base level homeowner’s insurance policy. This covers very general damages that could occur in your home, such as smoke damage, wind/storm damage, vandalism, and broken glass, among others problems. Basic insurance usually also covers a low level of personal liability, which would take care of you financially if someone else got hurt while visiting. Be careful, though, as this insurance usually doesn’t typically cover any of the items within your home if they are damaged. These are very basic level coverages for the smallest issues that could happen at your home.

Moderate Home Insurance

This is a higher level of home insurance coverage that covers a few more bills. Moderate home insurance policies will take care of things like falling objects that could damage your home as well as freezing issues such as broken pipes due to the cold temperatures. This policy can also cover some of the major items in your home, such as a water heater or kitchen appliances, if they are damaged. These are all good things to have covered because many of these issues could pop up almost at any time.

High Home Insurance

This is the best kind of homeowners insurance. This one covers much more, including a lot of common weather events, theft of property from inside the home, and damage to other structures like a garage or a shed. High-level home insurance policies typically offer more coverage for more situations of personal liability, too, in case someone is injured at your home. For those who have important items in their home, this policy will offer extra coverage for these, compared to the other options. These policies are considered the best option for most homeowners to have in their home.

So, what is not covered?

While homeowners insurance covers a lot of issues that could find their way into your life, some problems are not covered at all. Floods and earthquakes, for example, are covered by separate insurance policies. Areas that are prone to these types of issues will charge quite a bit more for coverage due to the elevated risk, which is why these aren’t covered by a regular homeowner’s insurance policy.

This also brings up the question of grey areas. If your policy covers certain types of storms but not others, you can find yourself in a tough spot with the insurance company. Sometimes a major storm hits and causes damage to the home, but if it was a flood, it may not be covered by regular homeowners insurance. Be sure to talk to your agent to figure out what is covered and what is not.

Cost of Home Insurance Coverage

Many different factors play into the cost of home insurance premiums, including:

Home Value – The total value of your house, garage, shed and any other structures will be considered in figuring out the premium. It’s hard to say for sure if owning a newer or older house will save you money on your homeowners insurance. On the one hand, a new house is made of new materials and will cost more to repair. On the other hand, parts of an older house could be damaged easier, and beyond repair, making a good case for charging higher premiums.

Amount of coverage – Naturally, the less coverage you opt for, the lower your premium. Basic and moderate policies are less expensive than high-level policies because they offer less coverage. Many insurers allow you to choose how much coverage you will have for any given part of the policy, allowing you to customize your premium a bit better.

As a homeowner, your best option is to sit down with an insurance agent to talk about your exact needs. Let them know how much you can afford and what you want to have covered. Remember to shop around to other insurance agents to find the best rate, and don’t be afraid to bring the quotes to other agents and ask for a better deal.

If you do your homework, consider the coverages you need, and shop around, you can find the best rate and the best coverage for your home.

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