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5 Key Coverages for an Excellent Home Policy


Many of the biggest and best insurance companies offer less than ideal home policies. Whiles there is almost no difference between personal auto policies, 95% of homeowners actually do not have the home coverage they want and think they have. Worse yet, they are likely paying more money for less coverage. Here are the key things to consider:


1. Full Replacement Cost - This coverage ensures that your home will be replaced, even if it costs more than what your home is insured for. This is similar to the more limited Extended Replacement Cost coverage, but unlike the extended coverage, full replacement has no limit to the amount it will pay out to replace your home. This grants you the piece of mind that your home truly is fully insured. In a recent case study by the Insurance Journal they report that 20% of homeowners who have suffered a total loss did not have adequate coverage, and had to pay a substantial amount out of pocket, just to replace their home, often times over $100,000.


2. Ordinance & Law - This coverage updates any facet of your old home to current code, in the event of a loss. Without this coverage, the insured is required to pay for the upgrades out of pocket, as the home cannot be repaired or replaced to standards that do not meet current code. One example of this would be the increasingly common city code of requiring in door fire sprinklers which can range from $3,000 - $35,000 to install.


3. Loss of Use - This coverage reimburses the insured for temporary housing and other living expenses (up to two weeks) in the event the insured is required to evacuate. The more limited additional living expense coverage would not reimburse the insured for the temporary living arrangments in the event of an evacuation if there is no physical damage done to the dwelling.


4. Additional Living Expenses - Several companies limit ALE and loss of use coverage to 12 months or 20% of the estimated replacement cost. For larger homes, or homes in rural areas where the number of homes being replaced exceeds the number of quality contractors in the area, it is unlikely that a one year would be a sufficient period of time to fully cover the insured, which would result in out of pocket costs. Higher quality policies cover the insured for 25% - 30% of the homes replacement cost or an increased 24 month period.


5. Comprehensive Perils - Most policies offer "broad" or the superior "special" perils coverage, but both of these limit the types of perils (things that can go wrong) covered on a policy to no more than 20 items. Comprehensive perils however, cover all perils that are not specifically excluded, which increases the types of events that are covered dramatically.


Thankfully we can offer you carriers whose policies cover all of the above items, and with clients who are claim free and have good credit scores we are able to procure these polices for you at greatly reduced price, with discounts up to 50%.

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