Home Owner? Here’s How To Know If Your Fire Insurance Policy Is Sufficient
According to the founder and CEO of Lionshare Partners, Chris Jackson, a lot of insurers have made consumers’ ability to get adequate insurance for their properties a difficulty. House insurance policies are becoming more complicated and less generous with each passing day.
That has shifted the costs and the risks to the policyholders and away from the insurers. Thus, for those who are bothered about their belongings and their home in its entirety getting damaged by fire and with no insurance, there are some things to take note of.
Limits Of Homeowners’ Insurance
The increasing awareness about fire safety precautions and practices are contributing to a general decline of fire incidences. However, those precautions do not extend to wildfires and these have become more destructive. Reports show that over 80 million acres of land in America in the past eleven years have been destroyed by these wildfires which happen in virtually all the states.
However, even if your area isn’t one susceptible to wildfires, loss of belongings or your home to fire outbreak remains a risk one needs to guide against. The National Fire Protection Association noted that between the year 2011 and 2015, there was a yearly average of about 358,500 house structure fires which made up for 3 out of four of all the structure fires.
The normal insurance policies for homeowners do not include insurance against fire. There are 3 primary areas that the general insurance cover.
Primary Dwelling: If the primary structure of your home gets damaged by fire, then the insurance policy for homeowners covers that. The structure includes the actual home itself as well as anything attached, such as the garage.
Detached structures: Also, the insurance policy for homeowners also covers structures which are situated on the property even though they are not attached to the home. That includes detached garages and sheds. A lot of policies also account for landscaping.
Personal property: Home belongings such as appliances, furniture, clothing, art pieces and also jewelry come under the protection of insurance policies for homeowners. If any of these get destroyed by fire then you get reimbursed by the policy. However, it is important to know that a lot of policies limit the reimbursement to a certain policy percentage which is most times between 40 and 75 percent. Also, the insurers pay for expenses like meals, hotels and other expenses you had to incur because you couldn’t inhabit your house as a result of the damage.
One pitfall of home insurance is that some insurers provide only actual coverage for cash value. Jackson explained that it is different from replacement coverage in the sense that it considers the depreciation in the determination of the amount you will be reimbursed. He added that the actual cash value, in turn, may not meet up to how much you need to cover replacement, which implies that the policyholder would have to pay more.
Jackson stated that the greatest asset for a lot of people is the home, and it is, therefore, essential that they are not underinsured. To determine whether or not your home has proper insurance, Jackson proposes asking three vital questions from your insurance company. The first question is to ask if you have sufficient insurance that will help you rebuild your home and also replace all your possessions. The next is to ask if you have sufficient coverage to afford additional living costs and the last is if the insurance for the protection of your assets is sufficient.
Jackson said that the important point here is to ensure that the particular policy you have can offer sufficient coverage. If the answer given to any of the questions is in the negative, then there is a need to either increase your existing coverage or get a special insurance policy against fire incidence.
Homeowners in High-risk Areas
It is true that a lot of homeowners already have adequate protection by their existing insurance policies in case of a fire outbreak. However, it is not particularly the case for people who are residents of areas that are highly susceptible to wildfires.
Jackson mentioned that premiums are increasing for homeowners in such high-risk areas and in fact, there are insurers who are not renewing the policies for people residing in such areas. He added that the insurer might lay down a requirement that you effect a couple of changes to your house exterior and also the surrounding property in a case where the house is in an area susceptible to wildfire. There are, however, insurance companies that also give discounts where the party has taken necessary steps for the prevention of damage to the home. Such steps include installation of fire-resistant roofing.
More in Insurance
You’ll Be Inspired After Reading Former NBA Player Junior Bridgeman’s Expectation-Defying Success Story
It’s a sad reality than a reported 60% of NBA players eventually go broke after about five years into their retirement...December 24, 2019
These Millionaires Refuse to Spend Their Money on These Items & Maybe You Should Too
Contrary to what most people might believe, not all millionaires spend indiscriminately on themselves. Some prefer to put their money on...December 23, 2019
Want to Advance Your Career? Avoid Turning Into These Negative Workplace Personalities at All Costs
One’s professional personality can make or break their career. Now, more than ever, workplaces are beginning to focus on creating positive...December 20, 2019
Want to Keep Your Creative & Analytical Skills Sharp For Work? Take On These Interesting Hobbies On Your Free Time
Self-improvement should be a lifelong practice, especially for people who want to advance their professional career. Doing so would help an...December 19, 2019
Your Profession May Have More Weight On The Car Insurance Rates You’re Granted With Than You Initially Thought
When assessing their applicants, car insurance providers create accurate profiles of individuals considering factors like their age, credit score, marital status,...December 18, 2019
You Won’t Believe How Much These Actors, Who Played Professors in the Harry Potter Movies, Are Worth
Young and old, everyone was captivated by the Harry Potter franchise – and who wouldn’t be? Die-hard fans carefully followed the...December 16, 2019
Experts’ Tips on Creating a Budget to Become Financially Successful
Have you ever been a one-day millionaire? After getting your monthly salary, you feel so rich that you eat at a...December 13, 2019
All You Need to Know About the Extraordinary YouTube Exec Susan Wojcicki, The Former Landlord of Google Founders Larry Page and Sergey Brin
Google has become more than just a proper noun, it is now also used as a verb in casual conversations. This...December 12, 2019
Dreaming of an Early Retirement? These Simple Steps Could Help You Achieve That
Every one of us has different dreams and aspirations in life, but one thing is for sure: we all want to...December 11, 2019