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7 Tips To Find Out If Your Home Is Under Insured
At first you may be tempted to say, “I have Atlanta homeowners insurance already… This doesn’t apply to me.” However, after reading these 8 points you may very well believe that in fact your home might be under insured.
There is an old saying that says, “You get what you pay for”. The danger of shopping for the lowest price has left thousands of families in Florida, Louisiana & California in massive debt because they were grossly under insured. Even after receiving their check from the insurance company they didn’t have enough to rebuild their homes and replace their belongings after natural disasters like hurricanes, flooding and forest fires. In fact, 75% of California homeowners that were affected by the 2007 wildfires were under insured on the average by a whopping $240,000 each!
We don’t want you to fall into that same trap. So review these points carefully and afterward do a little soul searching to see if you are unnecessarily exposing your family to risk.
Tip # 1: Stop shopping by price alone
I wonder how many of these families in California are kicking themselves for buying their home insurance by shopping around for the lowest price? Our goal here at Lloyd Pro Group is to get you the proper level of coverage that you need at the lowest price available. Make a resolve to yourself to get the best coverage for your money, not the cheapest premiums. Your family deserves it.
Let’s bring this point a little closer to home. Think about all of the poor families that are now stuck with the bill for all of the water damage restoration in Atlanta from the 2009 flooding. Sad to say the majority were not covered for flooding. In fact floods, earthquakes and sometimes hurricanes (depending where you live) are not covered by your standard homeowners insurance policy. Please don’t make this mistake too.
Tip # 2: “Loss of use”
So, let’s say you are having your home rebuilt due to a fire perhaps. Your home insurance policy will usually give you money to help pay for rent and living expenses during the repairs. This arrangement is called “loss of use”. Speak to your insurance agent about how much coverage your current policy offers. Experts say that the amount should cover you for two full years. If not then ask your agent for a higher limit. Remember that during a time of disaster insurance companies and restoration companies are swamped and it realistically could take up to 2 years to have your home rebuilt. Just look at what Hurrican Katrina did. Many of those poor folks are still waiting.
Tip # 3: Get “replacement cost” insurance
You have a choice to get either “replacement cost,”or “actual cash value” coverage. And while you may be tempted to save money and get “actual cash value” you would regret it when the time comes to make a claim. Let me explain. Did you know that if you have an “actual cash value” policy, you would only get a check for what your belongings were worth when they were damaged or stolen? At first this may sound O.K. but you will quickly find out that it will not be enough to replace it. Let’s say you had a 4 year old computer you paid a $1,000 for. At the time of loss it is now worth only $150.00 so you would get a $150.00 check from the insurance company. Now tell me, where are you going to buy a new computer for$150!
Don’t be cheap on this one. Yes, it may run an extra 10%-20% more than “actual cash value” policy, but I assure you it will more than pay for itself the first time you need to make a claim.
Tip #4: Make a list and check it twice!
Did you know that many policies limit your content coverage to a percentage of your overall policy limit? This means that your current policy has a “cap” on how much they are willing to pay for your contents if they were all destroyed. How do you know it will be enough to replace everything you own?
Take inventory! You would be surprised how quick these items add up! Take the old pad and pen in hand and make a detailed inventory of everything you own and write down how much it would cost to replace them. Will this take time to do? Yes, of course it will. But tell me, won’t it be worth it to find out now… instead of later that you have enough coverage to replace EVERYTHING?
Tip #5: Get a “mini” policy for the expensive stuff
Since most policies have a limit to what they will pay out on items such as jewelry, artwork, firearms, etc, you would be wise to invest in a “rider” a mini-insurance policy that will protect these for you. A “rider” will pay what it would actually cost to replace the item, no matter how much that might be. Talk to your GA insurance agent for details.
Tip #6: Get supplemental insurance
Many people are surprised to find out the their standard home insurance will not cover things like damage from a sewer back or replacing home business equipment that is damaged. Talk to your agent to make sure you are not left exposed.
Tip #7: What if someone sued you tomorrow?
While Atlanta liability insurance is designed to protect you from lawsuits, the odds are you probably do not have enough coverage on your existing homeowners policy right now. With the rising cost of medical care today and the jury awards that have been given to victims, you might want to look again at this closely. Remember, one lawsuit could cost you every penny that you have.
Since everybody wants to be a “millionaire”, defense attorneys recommend ta $1,000,000 worth of liability coverage. They go on to say that if you have teen age drivers you might even want to get more. Before you get nervous about the price, an umbrella policy usually will only run $200-$300 dollars ayear extra to give you the peace of mind.
Lloyd Pro Group is a Duluth Ga Nationwide Insurance agency and has been helping Atlanta Georgia protect what matters most since 1985. Lloyd Pro Group can be reached at (770) 497-1200 or on their website http://www.lloydprogroup.com
