Sharpen your pencil and find your seat because it’s time to go back to school! Home Insurance 101 with Jill Dawson, President at Dawson & Associates, is now in session.
What are the biggest misconceptions homeowners have about home insurance?
Here are some widespread myths:
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Standard policies cover all natural disasters. Typically, events like floods and earthquakes require additional coverage.
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Home insurance covers the home’s market value. Homeowners’ insurance is designed to cover the cost of rebuilding your home, not its market value.
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Small claims can be filed frequently without consequence. It’s often advisable to handle minor repairs out-of-pocket and reserve insurance claims for more significant damage.
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Maintenance issues are covered. Homeowners’ insurance does not cover regular maintenance issues and wear and tear.
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All homeowners’ insurance policies from every company are the same. While basic coverage may be similar, the specifics can vary. For instance, some policies might offer more comprehensive coverage for certain types of damage, like water damage, while others might have stricter limitations.
What does a standard home insurance policy usually cover, and what additional coverage could be necessary?
A standard homeowners’ insurance policy typically covers damage to your home and belongings if the damage is due to a covered peril (a risk or cause of loss). The most common perils include:
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Fire and smoke
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Lightning strikes
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Windstorms and hail
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Explosions
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Vandalism and malicious mischief
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Damage from an aircraft, car, or vehicle
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Theft and falling objects
A standard home insurance policy also typically includes four main types of coverage:
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Dwelling
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Personal property
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Liability protection
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Additional living expenses
Homeowners in Minnesota might also consider adding extra coverage such as:
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Flood
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Extended Replacement Cost Coverage. This ensures you have enough coverage to rebuild your home if construction costs rise unexpectedly.
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Personal property endorsements (high-value items such as jewelry or art)
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Sewer backup and/or sump pump overflow
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Cosmetic damage
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Matching of undamaged siding and/or roofing materials. Many companies offer an endorsement you can add to your policy that will provide coverage for the undamaged portions if a match cannot be found.
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Watercraft & RV Liability. If you own a boat or RV, this coverage can protect you from liability claims.
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Umbrella insurance provides extra liability coverage beyond the limits of your policy.
What’s the best way for homeowners to determine how much coverage they need for their homes?
There are several ways to do this, and our team is here to help guide you through the process with a personalized touch.
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Assess the cost to fully rebuild your home from scratch, including materials, labor, haul away, etc.
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Evaluate personal property to ensure the policy covers the total value of these items.
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Consider liability coverage to protect against lawsuits for bodily injury or property damage that you, your family members, or your pets may cause to others.
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Ensure your policy offers coverage for additional living expenses in case you need to live elsewhere while your home is being repaired.
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Review any policy exclusions in case purchasing additional coverage is needed.
To get a quote from this local hard-working team, visit www.mydawsonassociates.com
What are the biggest misconceptions homeowners have about home insurance? Standard policies cover all natural disasters. Typically, events like floods and earthquakes require additional coverage.