Your home is likely one of the biggest investments you’ll ever make. But when was the last time you took a closer look at your homeowners insurance policy?
Many homeowners purchase a policy, make their payments, and assume everything is covered. Unfortunately, that’s not always the case. Coverage can vary significantly between policies, and some important details may be overlooked until it’s time to file a claim.
Whether you’re purchasing a new home or reviewing your current policy, here are 10 important questions you should ask about your homeowners insurance.
1. Is my home insured for the right amount?
One of the most important things to understand is whether your dwelling coverage would be enough to rebuild your home if it were destroyed.
Keep in mind, the cost to rebuild your home isn’t necessarily the same as its current market value. Construction materials, labor costs, and other expenses can change over time.
What to ask: If my home were a total loss, would my policy provide enough coverage to rebuild it?
2. What exactly is covered by my policy?
Not every homeowners insurance policy covers the same things. Your policy may protect your home, personal belongings, detached structures, and provide liability coverage.
However, certain events and types of damage may be excluded or limited.
What to ask: What is covered under my policy, and are there any important exclusions I should know about?
3. Am I covered for water damage?
Water damage is one area homeowners should pay close attention to. While some sudden and accidental water damage may be covered, other types may not be.
For example, sewer or drain backups, sump pump failures, and flooding may require separate coverage or endorsements.
What to ask: Am I covered for sewer backup, sump pump failure, and flooding? Are there additional coverages I should consider?
4. Do I have replacement cost or actual cash value coverage?
This is an important distinction!
- Replacement Cost: Generally pays to repair or replace covered damaged property with new property of similar kind and quality, subject to your policy terms and limits.
- Actual Cash Value: Typically factors in depreciation, meaning you may receive less for older items.
For example, if your five-year-old television is damaged in a covered claim, actual cash value may account for its age and wear, while replacement cost coverage may help pay for a comparable new television.
What to ask: Are my personal belongings covered at replacement cost or actual cash value?
5. How much is my deductible?
Your deductible is the amount you are responsible for paying before your insurance coverage applies to a covered claim.
Some policies also have separate deductibles for specific events, such as wind or hail damage.
What to ask: What is my deductible, and do I have any separate deductibles for certain types of damage?
6. Do I have enough personal property coverage?
Think about everything inside your home: furniture, electronics, appliances, clothing, jewelry, and more.
If you had to replace everything after a major loss, would your coverage be enough?
Certain valuable items, such as jewelry, collectibles, firearms, and artwork, may also have special coverage limits.
What to ask: Do I have enough coverage for my belongings, and should any valuable items be scheduled separately?
7. Am I protected if someone gets injured on my property?
Homeowners insurance typically includes personal liability coverage. This can help protect you financially if you are legally responsible for someone else’s injuries or property damage.
For example, if a visitor slips and falls on your icy sidewalk, liability coverage may help with covered claims.
What to ask: Is my liability coverage high enough, and should I consider an umbrella policy for additional protection?
8. Does my policy cover roof damage?
Your roof is one of the most important parts of your home, especially here in Wisconsin, where we experience strong storms, hail, snow, and freezing temperatures.
Roof coverage can depend on the age, condition, and materials of your roof, as well as the specific terms of your policy.
What to ask: How would my policy cover roof damage from wind or hail? Is my roof covered at replacement cost or actual cash value?
9. Am I getting all the discounts I qualify for?
You may be eligible for discounts you don’t even know about!
Some common homeowners insurance discounts include:
- Bundling your home and auto insurance.
- Having a security system.
- Installing smoke detectors or other safety devices.
- Having a newer roof.
- Maintaining a claim-free history.
- Updating certain home systems.
What to ask: Am I receiving all the discounts available to me?
10. When was the last time my policy was reviewed?
Life changes, and your insurance should keep up!
Maybe you’ve remodeled your kitchen, added a deck, purchased expensive furniture, or finished your basement. These changes could affect the amount of coverage you need.
What to ask: Is my current policy still appropriate for my home, belongings, and lifestyle?
Don’t Wait Until You Have a Claim to Find Out What’s Covered!
Homeowners insurance is about more than just having a policy. It’s about having the right protection when you need it most.
Taking a few minutes to review your coverage now could help prevent unexpected surprises later.
At Midwest Certified Insurance Agency, we believe you should feel confident about the insurance protecting your home and everything inside it.
Have questions about your homeowners insurance? Reach out to our team! We’d be happy to review your current coverage, answer your questions, and help you understand your options.
Your home is worth protecting. Let’s make sure your coverage is too!
