Understanding Your Homeowners Insurance Policy

posted 6/13/2013 in General

For many people, our home is the most valuable asset we own.  We take pride in making it look nice and spend hours maintaining it each year.  However, the majority of us probably couldn't answer some very basic questions about the insurance policy that protects it in the case of an event that damages or destroys our home.  How much coverage do you have for your dwelling and personal contents?  Do you know how much coverage you have for your other structures like detached garages or storage sheds?
See our full home insurance infographic here
Studies show that as many as 59 percent of homes are underinsured.  That's a frightening statistic!  At LSB, we want to make sure you know and understand your homeowner's policy so you won't be surprised or disappointed if you ever have a homeowners claim. 
On a basic homeowner's insurance policy, there are 6 areas of coverage you should know and understand:

DWELLING- The amount of DWELLING coverage you purchase should be enough to cover the cost of rebuilding your home in the event of a complete loss.  Don't confuse this amount with the market value of your home, as the market value includes the value of your land.

PERSONAL PROPERTY - Typically a home insurance policy will provide 50-70 percent of your DWELLING coverage towards contents/personal belonging coverage.  You may want to purchase more depending on the value of the personal belongings in your home.  If you own jewelry, art or other expensive personal property you will want to consider a scheduled endorsement for those items.

OTHER STRUCTURES - This coverage is typically 10 percent of the DWELLING coverage.  This covers detached garages, storage sheds, and fixtures attached to the land including fences, driveways, sidewalks, patios and retaining walls.  You may want to consider whether the standard 10 percent would be adequate for your situation.

LOSS OF USE - This coverage provides reimbursement for living expenses incurred if your home is destroyed or damaged and other living arrangements are necessary while repairs are made.  Most standard home insurance policies will provide coverage up to 20 percent of the DWELLING coverage.

PERSONAL LIABILITY - This protects you or covered family members against lawsuits. Standard home insurance policies will typically include a minimum of $100,000 for each liability claim but some homeowners may take out an extension for additional protection against liability lawsuits.

MEDICAL PAYMENT - This coverage, commonly referred to as MedPay, will cover medical costs in the event that someone is injured on your property and does not want to sue you.  Typical MedPay coverage will cover $1,000 per injured person but an extension of this coverage is available.
 
Find out some interesting facts on homeownership and review the important parts of your policy by checking out our Homeowners Insurance Infographic at http://www.mylsb.com/webres/pdf/LSB-Homeowners-Insurance.pdf.  If you are unsure of your coverage for any of these main areas under your homeowner's insurance policy, we strongly encourage you to contact your insurance agent to discuss your coverage. 

Are you interested in learning how you can save money by bundling your auto and home insurance?  Take a few minutes to request a quote from LSB for your auto or homeowners insurance here: http://www.mylsb.com/insurance/Quotes/request-quote.aspx

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