12/13/2010 12:06 AM

The Finer Points of Homeowner Insurance

In my last blog, i discussed some of the coverages that the average consumer misses on Auto Insurance.  In this article, I'd like to review some of the very important Homeowner Coverages.

As I mentioned, buying insurance is a complicated contract.  It is written by a team of attorneys to protect the rights of the insurance company, not you!  If you are trying to save 15% in 15 minutes, you are probably going to pay more in the long run.  Here is a few items for your Homeowner policy to consider:

  • Off Premises Theft:  This covers your goods when they are not in the home.  For example, golf clubs or holiday gifts being stolen out of the trunk of your car.  20% of all theft claims originate in other than the victims home
  • Liability Limits Too Low:  Most homeowner policies I see have a $300,000 liability limit.  The cost to increase it to $500,000 is only $8-15 per year.  Also, make sure your Liability covers you for Personal Injury
  • Missing Jewelry Schedule:  A standard policy covers between $1,000 and $5,000 in jewelry coverage.  In order to be fully protected items should be individually scheduled on the policy.  This provides more coverage (like mysterious disappearance) and agreed amount coverage. 
  • Water Back Up:  If a sewer or bathroom overflows, coverage is excluded unless Water Back Up coverage is provided.
  • Identity Fraud:  Covers you if your identity is stolen.  The average cost to fix an identity theft is $10,000.  Identity Fraud is the fastest growing white collar crime.  According to Travelers Insurance Co, 1 in 25 Americans are victims of some kind of Identity Fraud.
  • Windstorm Deductible:  This is the deductible for wind damage to your home.  It is expressed in percentage of your homeowner coverage.  Standard is 2% on Long Island.  That means if your home is covered for $500,000 the deductible for windstorm is 2% or $10,000.  Windstorm deductibles can go as high as 5%.

These are just a few of the coverages that most people overlook.  I see policies everyday and I'm astounded at the number of poorly written contracts.  The strange thing is that many of the policies I see are from lawyers, accountants etc.  Even the people who are in the financial services industry, do not know they are missing coverages.  Bottom line, consult a professional like Brooks-Waterburn. 

For more information, go to our website at www.brookswaterburn.com

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