Just like all drivers need car insurance for their vehicles, all homeowners need insurance for their homes. However, many homeowners don’t have as much insurance as they should, which can be devastating if something happens to their home. In the United States, roughly two out of every three homes does not have the proper amount of insurance. All homeowners need to revisit their home insurance and make sure they are properly covered or add the extra insurance they are currently missing. Here is what not having enough home insurance can mean for homeowners when it comes time to use it.
Being Uninsured Brings Risks
The reason why there are so many homeowners who are underinsured is because they don’t know they’re underinsured. When a homeowner chooses their home insurance on their own without the help of an insurance agent, they can only use the guidance they can find online. Homeowners need to make sure they have proper insurance in order to protect against things such as the following:
- If the home is destroyed, the things inside the home may not be covered
- Basic insurance packages often don’t protect against things like floods
- It’s possible for the homeowner to lose their home if they are ever sued
- If the home is destroyed, they will only receive the amount of money the home was insured for, not the value of the home
If something happens to a home and the home is underinsured, then it will be an unpleasant surprise when the homeowner isn’t able to get the monetary compensation they need.
Ensuring a Home is Properly Insured
For someone who doesn’t have very much experience with insurance, it can be difficult to tell when a home has the right amount. Plus, choosing insurance can be confusing with all of the different options and add-ons to choose from. When updating home insurance, try to keep these things in mind:
- Add insurance for floods, earthquakes, and deferred maintenance if those are issues that could arise with the home
- Always buy at least $300,000 of liability coverage; never go with just the minimum
- Talk with an independent insurance agent to find out the home’s replacement costs for an accurate insurance price estimate
- When making additions to a home, update the insurance policy to reflect the changes
Once the home is damaged by fire, a storm, or something else, it’s too late. Homeowners need to take the time to check their insurance as soon as they can to make sure their home has enough insurance.
Insuring a Home
The world of home insurance can be difficult to navigate, especially for someone who isn’t versed in all of the technical aspects. Because of this, it can be extremely helpful to work with an insurance agent who can help guide the homeowner through the process and customize their policy so it fits all of their home’s unique needs. When looking for an insurance agent, make sure to select someone who is licensed to work in the state. This can be verified by looking up the agent in the National Association of Insurance Commissioners’ Consumer Information Source (CIS). Additionally, it can be helpful to look up reviews of the agent and look into their credentials to ensure they have experience.
Home insurance is the best and easiest way to protect a home, so homeowners owe it to themselves to make sure their home is properly covered. Taking just a few minutes out of the day to check the policy can save a lot of stress down the line should anything ever happen to the home.