In the US, the average yearly homeowner’s insurance premium is just over $800. While getting quotes from multiple providers can help one get a competitive rate, cost should not be a deciding factor when choosing a policy. Lower-cost policies often don’t offer the right level of coverage, which can be costly. Whether one is buying their first policy or they’re re-evaluating coverage needs, they should avoid the mistakes listed below.
Underinsuring the Home
Over 60% of homes in the United States are undervalued as far as insurance is concerned. Therefore, if such a home is damaged beyond repair, a homeowner wouldn’t be able to rebuild. According to a recent survey, most people only have coverage equaling 81% of the home’s replacement value. One can avoid the mistake by consulting a professional estimator, local contractor or builder. When one knows the home’s rebuilding cost, they should examine their homeowners insurance in Carlisle PA and increase coverage accordingly.
Assuming There’s Flood Insurance
Floods are the most frequent natural disaster in the US, and they result in average losses of $38,000. However, the coverage is not part of a conventional homeowner’s insurance policy. Those living in a flood plain are often required to buy flood insurance as a condition of getting a mortgage. However, those who live in low-risk areas don’t often think of getting flood insurance, or they assume it’s included in a homeowner’s policy. There’s no way to stop nature, but purchasing flood insurance can cover the expense of rebuilding a home.
Not Knowing About Deductibles
One may not know that the deductible, or amount paid before insurance coverage kicks in, can be increased in certain cases such as named storms or earthquakes. Homeowners can avoid deductible errors by taking time to understand the process now. One should determine if their deductible can vary depending on the reason for damage, and they should ask the agent if the deductible changes from a predetermined rate to a percentage of coverage.
If a homeowner isn’t sure whether their insurance policy offers adequate coverage, or if they are unsatisfied with the policy, they should contact a local insurance professional with Farnham Insurance. A nearby agent will be happy to help them find the right Homeowners insurance in Carlisle PA for their needs.
