Understanding Home Insurance: From Coverage To Claims

​Unless taking out a mortgage, homeowners are not required to have insurance for their homes. However, it is a wise investment to protect your home and finances. Here are some things you have to understand about getting home insurance.

​Types And Coverage
There are different types of insurance based on the coverage they provide. The most common one is HO-3. This policy offers coverage from almost all kinds of perils or disasters except the ones specifically excluded. However, it only covers your belongings against a list of threats.

HO-5 has an open coverage on both your house and belongings excluding those specified in the contract. The broad coverage this policy provides makes it more expensive.

HO-6 policy, on the other hand, is for co-op or condo owners. It covers the structure of the part you own, your personal belongings, and liability.

Aside from the coverage of your policy, you also have to think about which amount to receive in case of a claim.

• Cash Value: pays for the repair or replacement of your property but only amounting to its depreciated cost. 
• Replacement Cost: covers repair or replacement up to the limits of your policy and without deducting your property’s depreciation cost.
• Guaranteed Replacement: means that your house is covered even if the cost is higher than your policy limit.

Limitations of Coverage
A comprehensive policy doesn’t mean a complete coverage to everything. Some natural disasters such as ground flooding and earthquakes are not covered although you may purchase additional insurance for them.

There are also limitations on the coverage of your possessions. Make sure to carefully read your policy contract to know the cap on the insurance for your belongings.

Most policies usually require something to be “accidental” or “sudden” for it to be covered. Damage caused by neglected maintenance is neither. Your insurer can deny your claim in that case. 

When To Claim
Your insurance has your back, but remember to be careful when making a claim. Your claim history determines your rates so avoid needlessly filing as it may cause your premium to shoot up. If you do claim, policies often have a 14-day window to report. 

Paying for home insurance isn’t fun, but it’s best to be prepared when tragedy strikes. After all, home is your safe place. It’s only right to keep your safe place secured and protected too.

At Berlin & Denys Insurance, we aim to provide comprehensive insurance policies that make your life easier. We want to help you get the insurance that fits your needs. You can get more information about our products and services by calling our agency at (800) 946-3303. Get your free quote today by CLICKING HERE.