The Importance Of Home Insurance

Home insurance is must-have insurance for you as a homeowner that protects your precious house and reimburses you from losses due to destruction and damage. Bit by bit, you saved and bought your dream home. Wouldn't you be shattered if it suffers any harm like flood damage, hurricane damage, etc.? Such natural calamities are unpredictable and uncontrollable and in the event of a loss like this, you must try to recoup what you have lost.

One way of making up for property damage is by opting for insurance coverage from top insurance companies for your home. Insuring your primary residence or rental property is the best way to regain the money you lost due to property damage. The cost of homeowners insurance coverage is negligible when compared to the consequences and aftermath of rebuilding a fire or flood-affected home. 

Insurance protection is also a must when you apply for a mortgage loan on your new home. No loan is sanctioned without homeowners insurance. Compare the limits of coverage and buy your standard and optional coverages from reliable homeowners insurance companies. 

Having understood this, let us learn more about home insurance.

Property Insurance

Property insurance is the set of insurance policies that cover properties. This coverage might be in the form of property protection or liability protection.

Property protection offers to repay the damage costs to the owner or renter of the building in case of an accident or theft. It also reimburses any person injured in the mishap, even if he is other than the owner or renter.

Property insurance includes several homeowners policies like

• Homeowners insurance
• Renters insurance
• Flood insurance
• Earthquake insurance

Adequate homeowners coverage for property insurance is of 3 types- actual cash flow, replacement costs, and extended replacement costs.

Property insurance covers the effects of hail, snow, lightning, fire, smoke, etc., but it does not have flood coverage or tsunami coverage. Nor does it include the damage due to flooding of drain valves, seepage of groundwater, damage to sump pumps, mold formation, etc. These would be considered additional options that you can add to your policy. 

Homeowners Insurance 

Homeowner's insurance refers to the insurance on personal property and real property like a home. 

If your home suffers accidental damage, only home insurance can help you cover the cost of damage. Homeowners' insurance may cover damage due to theft, natural calamity, vandalism, etc.

Homeowners' insurance policies include dwelling coverage, structures coverage, personal liability coverage, medical bills, etc.

Reasons why home insurance policies are a must

Standard homeowners' policies do more than just protect your home. Sufficient coverage for the square footage of property will ensure peace of mind. They include the potential costs for covered events like these:

Financial safety

All of us do our best to safeguard our homes with the latest gadgets for their physical safety. But, financial losses are bound to occur if the house is damaged due to any natural disasters. If you ensure financial protection for your home through insurance coverage, these losses can be minimized.

Getting your mortgage loan approved

Every mortgage company which lends money insists on not just your property as the collateral but also on building insurance to protect it. Since the building is part of the security that the mortgage company has over the loan, it insists on a homeowners insurance policy to protect its financial interest and get its mortgage payment done.

Accidental damage cover

Sometimes, expensive items like carpets or paintings are ruined by a fire or a flood. If you had taken an accidental cover over them, you can make up for their loss. A standard policy for such accidental coverage must cover air conditioners, hot water boilers, water heaters, etc. Even drain boilers, drain plumbing fixtures, water pipes, and sewer backup may be covered within the policy limit, if not they might be able to be added.

Replacement cost policies

Some personal items like laptops, musical instruments or phones may be covered under this replacement coverage. If such items are lost or damaged within a specified period, they will be replaced if they have a replacement insurance cover.

Medical expenses coverage

Medical payments can cost dearly in case of unexpected emergencies. Some home insurance policies cover such medical payments and help you ease your financial burden.

Structures coverage

Sometimes additional structures in your home like a yard, fence, or garage might get damaged in a natural calamity or even due to malicious mischief. Dwelling limits coverage may even include damage to trees. If they are covered by homeowners' policies for insurance, you can regain their losses.

Personal liabilities coverage

If any damage is caused to someone else's personal property, this personal liabilities coverage will come in handy. This liability insurance will cover the repair costs along with the medical bills if necessary.

Additional living expense coverages

If your home is ravaged by a fire or some natural disaster, then you will need an alternate living accommodation. You may have to bear expenses for hotel lodging till you settle into your new home. The extra cost for the living expenses that you incur on account of this is borne by this separate policy for additional coverage.

Guest medical protection

This type of coverage takes care of any medical expenses incurred by a guest.

In conclusion,

All insurance policies have coverage limits. This limit is the maximum amount your policy will pay towards the covered claim. Also, check the documents regarding Federal Flood Insurance - Policy Forms and Documents, and the Center for Insurance Policy and Research (CIPR) website to learn more about your insurance laws, rights and duties.

Look for standard homeowners' insurance policies that have increased limits to cover the cost of losses. Good insurance companies have smart insurance agents who suggest the right insurance plan with adequate limits for you. If you are in the State of Maryland, contact Billy Sutton and Lacey Sutton from Coldwell Banker Chesapeake Real Estate to guide you on getting the right insurance for your home or property.