Home Owner’s Insurance 101

A solid homeowner’s insurance policy is key to protecting your finances – and your dream home. If a disaster should strike, such as tornado, fire or theft, you’ll need a policy in place to safeguard against draining your life savings or taking on enormous dent in order to repair structural damage, replace stolen items, and more. Not all insurance policies are equally protective, however, so it’s important to know these key items about your policy:

What the Policy Covers

Nearly every insurance policy will cover damage to your home caused by a natural disaster. However, many policies don’t include flood coverage. If you live in a flood plain, you should strongly consider investing in a separate flood policy. Similarly, many homeowner’s policies provide full coverage for belongings, but many require a separate type of policy for your jewelry.

What the Policy DOESN’T Cover

It’s important to know that the majority of policies will exclude coverage for earthquakes, landslides and power failures. Many also exclude windstorm coverage in areas prone to tornadoes or hurricanes, requiring home owners to maintain supplemental insurance for such damage.

Why You Should Keep Stellar Records

Insurance experts report that many homeowners see their legitimate claims rejected simply because they couldn’t provide proper documentation of the damage or repair costs. It’s important to save every receipt, contract and appraisal for big-ticket items and, if an unforeseen loss occurs, document everything you tried to do in order to mitigate damages and costs.

When to File an Insurance Claim

You will certainly want to file a claim in the event of a true disaster, and you should consider filing for legitimate, but lesser, damage to your property, too. Insurance companies don’t like frivolous claims, though, and it’s possible that your rates will rise if you’re a habitual offender.

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