It may be tempting to go with the most affordable rate for homeowners. Oftentimes, however, this coverage may be lacking crucial coverage that a slightly more expensive policy may cover.
Many people in Florida hear homeowners and mistakenly assume it is solely an insurance that provides protection for hurricane damage. The reality of homeowners, however, is much larger in scale and in depth. Homeowners insurance is designed to cover a policyholder’s property, possessions, and other people who may be harmed on your property.
When looking at homeowner’s insurance policies, it is important to remember that different policies also provide different coverage options. One option commonly available is “Replacement Value” versus “Actual Cash Value.” Though it is possible to save money by getting actual cash value of items, keep in mind that if a disaster occurs, the cost of items at a depreciated value will not cover the costs to replace the items lost. It is also important that the value of the insurance policy be adequate enough to replace the property should a disaster occur.
Insurance coverage is calculated by determining how much risk an insurance company takes in guaranteeing coverage for a certain amount. As such, it is possible that one insurance company determines a property to be at a higher risk than another company. It is also possible for a company to be willing to offer a certain amount of coverage for a potential disaster that another company will not.
Temporary Living Expenses
In the event of an emergency, the costs of staying at a hotel, renting another house, or securing a guesthouse causes costs of living to significantly increase. Though it may seem unlikely now, make sure that a homeowners policy covers temporary relocation expenses should it be necessary to stay somewhere else while a property is being evaluated or rebuilt.
Third Party Liability
Assume for a moment that a neighbor’s child is playing near the front yard. Should that child fall on a policyholder’s property, the homeowner has the responsibility to help cover the medical expenses of that child as well as any pain and suffering for which the family may sue. Other third party liability coverage includes protection should the policyholder have a dog that bites someone or cobblestone steps on which an elderly neighbor may fall.