You may be surprised at how many people do not know what is covered on their home insurance policy. After a disaster strikes is not the time to find out that you lack the needed coverage. Now is the time to check your policy and make sure any gaps are covered before it is needed. Then, you can decide to replace your policy, if needed. This article will discuss five key things you should consider when you look over your insurance policy.
When looking to replace a policy, make sure to get the best deal by comparison shopping. There are many comparison sites on the Internet where you can do this quickly and easily. When you are comparing home insurance policies, make sure that you are comparing the same coverage levels as well as premium amounts in order to get the best deal.
Make sure your new home insurance policy is for replacement value, or you may find yourself very short of what you need when you need it. Cash value or fair market value is about as much as your things would be worth at a garage sale. You need to replace your things with new things of a similar quality. Therefore, it is important that your policy includes replacement value coverage.
While on the subject, replacement value does not just pertain to your possessions, but rather, it should also pertain to your home. You need extended or guaranteed replacement value for it. Guaranteed replacement value is very difficult to come by; it guarantees that your home will be rebuilt no matter what the cost. Extended replacement value home insurance may be as close as you can get; it covers up to 100 percent of the value of the home and a small percentage over that in order to cover the cost of construction.
Some important things that you need to know are how exactly your home insurance company handles claims. You need to know whether the insurance company will write you a check for your claim upfront or will it make you replace what was lost and then reimburse you. Some home insurance companies will pay you a cash value for your furniture and other personal items right after a claim is filed but will not pay the replacement value until after you replace the things and can show the receipts.
You also need to know if there is a time table to replace your belongings. Some companies expect you to rush right out and buy all new items; however, if your home has been destroyed, you may not have a place to put the replacements. You may need to get a storage unit, which will cost more.