When a natural disaster threat is looming, it is too late to start thinking about buying home insurance. Now is the time to review and update your home policies.
Check the reputation of the insurance company you are considering using for handling previous claims.
Make sure you know what it would really cost to buy or build a comparable home. Get several estimations from local builders and then get a quote from your insurance agent on their suggested policy.
Understand your replacement coverage. You may need to adjust your current policy accordingly. Also ask what you would be paid if you decide to move to a different location.
Some insurance policies may stipulate that you have to rebuild on the same plot of land in order to fully collect.
Actual value coverage means you will be paid for the depreciated value of your lost items, not for the replacement cost of the item. Actual value coverage means if your roof was 15 years old, the company will pay for the remaining life of the roof. Replacement cost means that the company will pay to replace your 1980 television set with a brand new one.
Know how much it would cost to reconstruct a home like yours in current updated local codes and ordinance.
Review your home owner policy. Most standard policies cover damage from wind, but not flooding. Damage from rising water or blown in rain from storm is not covered in standard policy. If you live in a flood zone or an area susceptible to hurricane and strong storms, you need flood insurance to cover your home contents.
Most home contents cover only 50 percent of the dwelling coverage. If you have valuable items, it is easy to get extra coverage. You will have to pay a higher premium, but it is worth it.
Inform your home insurance company of any remodeling or extension. If they don’t know about it, they will not cover the replacement cost.
All home owner policies pay the cost of temporarily living away from home while the construction of your house is under way. If you still owe the bank, you will need to pay your mortgage each month. Would you survive comfortably from the amount you would receive from the insurance company?
If your claim was denied, ask for a detail description of why and challenge the findings. Contact your state insurance department and file a complaint.