Home Insurance...

Homeowners Insurance

What Is Homeowners Insurance?

A standard homeowners insurance policy includes four essential types of
coverage. They include:

• Coverage for the structure of your home.
• Coverage for your personal belongings.
• Liability protection.
• Additional living expenses in the event you are temporarily unable to
  live in your home because of a fire or other insured disaster.

1. The Structure Of Your House

This part of your policy pays to repair or rebuild your home if it is damaged or destroyed by fire, hurricane, hail, lightning or other disaster listed in your policy.
It will not pay for damage caused by a flood, earthquake or routine wear and tear.
When purchasing coverage for the structure of your home, it is important to buy
enough to rebuild your home.

Most standard policies also cover structures that are detached from your home such as a garage, tool shed or gazebo. Generally, these structures are covered for about 10% of the amount of insurance you have on the structure of your home. If you need more coverage, talk to your insurance agent about purchasing more insurance.

2. Your Personal Belongings

Your furniture, clothes, sports equipment and other personal items are covered if they are stolen or destroyed by fire, hurricane or other insured disaster. Most companies provide coverage for 50% to 70% of the amount of insurance you have on the structure of your home. So if you have $100,000 worth of insurance on the structure of your home, you would have between $50,000 to $70,000 worth of coverage for your belongings. The best way to determine if this is enough coverage is to conduct a home inventory.

This part of your policy includes off-premises coverage. This means that your belongings are covered anywhere in the world, unless you have decided against off-premises coverage. Some companies limit the amount to 10% of the amount of insurance you have for your possessions. You have up to $500 of coverage for unauthorized use of your credit cards.

Expensive items like jewelry, furs and silverware are covered, but there are
usually dollar limits if they are stolen. Generally, you are covered for between
$1,000 to $2,000 for all of your jewelry and furs. To insure these items to their
full value, purchase a special personal property endorsement or floater and insure
the item for it's appraised value. Coverage includes “accidental disappearance,”
meaning coverage if you simply lose that item. And there is no deductible.

Trees, plants and shrubs are also covered under standard homeowners insurance. Generally you are covered for 5% of the insurance on the house,
up to about $500 per item. Perils covered are theft, fire, lightning, explosion,
vandalism, riot and even falling aircraft. They are not covered for damage by
wind or disease.

3. Liability Protection

Liability covers you against lawsuits for bodily injury or property damage that you
or family members cause to other people. It also pays for damage caused by your
pets. So, if your son, daughter or dog accidentally ruins your neighbor’s expensive
rug, you are covered. However, if they destroy your rug, you are not covered.

The liability portion of your policy pays for both the cost of defending you in court and any court awards—up to the limit of your policy. You are also covered not just in your home, but anywhere in the world.

Liability limits generally start at about $100,000. However, experts recommend
that you purchase at least $300,000 worth of protection. Some people feel more
comfortable with even more coverage. You can purchase an umbrella or excess
liability policy which provides broader coverage, including claims against you for
libel and slander, as well as higher liability limits. Generally, umbrella policies
cost between $200 to $350 for $1 million of additional liability protection.

Your policy also provides no-fault medical coverage. In the event a friend or neighbor is injured in your home, he or she can simply submit medical bills to your insurance company. This way, expenses are paid without a liability claim being filed against you. You can generally get $1,000 to $5,000 worth of this coverage. It does not, however, pay the medical bills for your family or your pet.

4. Additional Living Expenses

This pays the additional costs of living away from home if you can't live there
due to damage from a fire, storm or other insured disaster. It covers hotel bills, restaurant meals and other living expenses incurred while your home is being rebuilt. Coverage for additional living expenses differs from company to company. Many policies provide coverage for about 20% of the insurance on your house.

You can increase this coverage, however, for an additional premium. Some companies sell a policy that provides an unlimited amount of loss-of-use coverage, but for a limited amount of time.

If you rent out part of your house, this coverage also reimburses you for the rent that you would have collected from your tenant if your home had not been destroyed.

Should I Purchase An Umbrella Policy?
If you are ever sued, your standard homeowners or auto policy will provide
you with some liability coverage, paying for judgements against you and your
attorney's fees, up to a limit set in the policy. However, in our litigious society,
you may want to have an extra layer of liability protection. That's what a
personal umbrella liability policy provides.

An umbrella policy kicks in when you reach the limit on the underlying liability
coverage in a homeowners, renters, condo or auto policy. It will also cover you
for things such as libel and slander. For about $150 to $300 per year you can
buy a $1 million personal umbrella liability policy. The next million will cost about
$75, and $50 for every million after that.

Because the personal umbrella policy goes into effect after the underlying
coverage is exhausted, there are certain limits that usually must be met in order
to purchase this coverage. Most insurers will want you to have about $250,000
of liability insurance on your auto policy and $300,000 of liability insurance on your
homeowners policy before selling you an umbrella liability policy for $1 million
of additional coverage.

What Types Of Disasters Are Covered?
Coverage varies depending on your policy. This link from the Insurance
Information Institue provides a general overview but please check your
insurance policies for the "perils" covered. Our agents will be glad to help you
better understand your policy and it's coverages.
General Disaster Coverage

Why should I purchase from Ludovissy & Associates?
Most customers save money with us because we offer some of the most
competitive rates around. We offer excellent customer service at three different locations servicing the Dubuque and surrounding areas and with 25 plus years
experience, we are the trusted name when it comes to your insurance needs.
Just ask your neighbor!