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With all our recent natural disasters, fires, hurricanes and floods, understanding your insurance coverage is more important than ever. I set out to discover what we may not know about insurance and what tips brokers have for us. Often, homebuyers select their homeowners policy based on the best pricing or they bundle with the same carrier who covers their other insurance such as auto. Many of us don’t ask questions or try to understand if we are underinsured or even read our policies! Hopefully this information is helpful.

Inventory Your Home~ Should you have a property loss, the best thing you can do is have proof of the contents in your home. The best way to do this is with photos or videos. It’s as simple as walking around your home and videoing every room top to bottom. For major appliances or electronics, getting the model or serial number is very helpful. There are also apps you can use for inventorying such as Sortly and Know Your Stuff. If you prefer a more old fashioned approach, a spread sheet of larger priced items can be helpful to keep. Keeping receipts for larger priced items can help as well. Make sure to store the inventory on the cloud or outside of your home.

Umbrellas~ Umbrella policies or extra liability insurance, is designed to help protect you from major claims and lawsuits and as a result help protect your assets and your future. It provides additional liability coverage above the limits of your homeowners and auto and is meant to help protect you from large and potentially devastating liability claims or judgments. Many large auto accidents involve large personal injury awards. Without an umbrella policy it’s very possible that an accident could cause major devastating financial consequences such as seized assets and years of garnished wages. The coverage is very affordable.

Flood Insurance~ Most people buy flood insurance if they are required to due to being in a designated flood plain of 100 years or less. Unfortunately, most of the time you do not recover the full cost of your home/losses in a flood. Most of the time the NFIP pays out a limit of $250,000 for the building and $100,000 for personal property to homeowners with full flood losses. Usually this amount does not cover the full cost of replacement. Water that comes up from your foundation like ground water seeping through your foundation floor is not covered by floor insurance.

Water/ Sewer Back Up~ Water and sewer backups are not always covered on policies. If you add this coverage, the damage caused by water entering your home through a sewer drain, sump pump or any other system that drains subsurface water would be covered. Also, if you have a pipe freeze in the winter and then slowly leak and cause mold, it can be tricky with how its covered. Many companies offer a “slow leak” endorsement that would add coverage for slow leaks.

Wild land Interface~ Living in a wild land interface such as the mountains or areas with dense fuels often makes it harder to get insured. Many carriers are more familiar with these types of homes and have policies to fit but homeowners need to often prove they have a defensible space around their home with a clearing of trees at least 30’- 50’ from the home. Pine trees need to be trimmed 6’ off the ground to prevent ladder fuels. Ideally, homes should be constructed of non-combustible materials.

Tips ~1)Most policies place low limits on the theft of items such as jewelry, silverware, firearms and other items that are high targets for theft. You may want to get additional coverage if you have multiple fire arms or high priced jewelry. 2)If you update your home with major systems or renovations let your broker know. Items that can save you money on your policy are new roofs especially hail resistive roofs and security systems. 3)Make sure your policy covers up to 24 months of additional living expenses in case you have to rebuild. 4)Don’t think of your insurance policy as a maintenance plan and avoid making small claims, use it only for large losses. Certain types of claims will raise your rates.

A special thanks to my contributors Mike Schmisek with Farmers Insurance and Chris Johnson with Dodrill Insurance Inc.

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