The Ins and Outs of Home Insurance with Susie Adib

The Ins and Outs of Home Insurance with Susie Adib
Published on
April 16, 2024

Let's acknowledge that accidents, disasters, and acts of nature happen. Your home is your largest investment, and it's essential to protect it with coverage that caters to your lifestyle. Home insurance offers you peace of mind, alleviates financial burdens, and provides coverage for unexpected events and emergencies. Additionally, it is vital to know precisely what your insurance covers and what it doesn't so that you can make informed decisions when taking out insurance policies. So, with home insurance, you can confidently welcome guests over, watch your dog play, and sleep better at night knowing that you're covered. 

Trust us; it's better not to realize the value of insurance when it's too late.

But, how much coverage do I need?

When you are purchasing a house, how much coverage do you need? Do you need enough to cover your mortgage? If you own your home, do you need to keep the exact amounts?

The answer is no. You only need enough coverage to rebuild your home. Home insurance covers the costs of rebuilding your home if there is a complete catastrophic loss. When you buy a house, that price is determined by the location, the market, and what the sellers are willing to accept. But, in regard to insurance, you already live in the neighborhood. You already own the land. So, those costs do not contribute to the amount of insurance that you need. You only need enough insurance to cover the cost to rebuild your home. The insurance carriers will always calculate the cost to rebuild your home. You can always choose to increase the amount of coverage on the policy, but you would be paying for insurance that you would never use. The insurance company is going to pay for the cost to rebuild your home up to the coverage on your policy. If there is additional coverage or if they don't use all the money on the policy, then you do not get a check for anything left over.

What is covered by my home policy?

The biggest question I get as an insurance broker is, “Is this covered?” 

When you think about your home insurance or even auto insurance, remember that insurance is meant to cover sudden accident loss. Those types of losses would be things such as lightning, fire, tornados, hail, and hurricanes. The simplest way to put it is anything that would happen to your home that you did not cause, on purpose, or that could have been prevented through maintenance.

Let's discuss the coverages on your home insurance and what they mean to you. Here are five of the most important coverages on an insurance policy and what they mean to you.

  1. Coverage A or Dwelling. This is the amount of coverage on your policy to rebuild your home. This is not the cost of your mortgage or the amount you paid for your house. This is the cost of the sticks and bricks to rebuild your house in the event of a catastrophic loss.
  2. Coverage B or Other Structures Coverage. This is coverage for anything else on your property that is not the house. This would include fences, sheds, or gazebos. The best way to explain other structures coverage is the State Farm commercial with Sheryl and her she-shed. The she-shed is covered under other structures. This is coverage is always calculated at 10% of the dwelling (Coverage A) amount.
  3. Coverage C or Personal Property Coverage. This is coverage for everything inside your house. If you take the roof off your house and shook it upside down. It is all the stuff that would fall out. All your furniture, clothes, shoes, the things hidden in the back of your closet that you forgot all about. You want to check and make sure that on your policy you have “replacement cost”. Replacement cost covers the cost to replace the damaged items at today's prices. Without replacement cost coverage, you would receive a depreciated cost of the item. So, if you have a couch that is 10 years old and it is ruined in a fire. You would be paid the cost of the couch minus depreciation. Replacement cost would protect the price of the couch. If that same cost costs $2,000 ten years ago, but $3,000 at today's prices. You would be paid today's prices.
  4. Coverage D or Liability Limits. This is the coverage for you if you are sued. In the winter, if you don't properly shovel your walkway and someone slips and falls, you are responsible. The Liability Limits in your home insurance would pay for those injuries. If anyone is injured on your property, you are responsible for those injuries. If a family member injures another person, it is your liability limits that pay for those injuries. If you have a dog, and they injure someone. This coverage is what pays for those injuries.A deductible is your out-of-pocket expenses. This is the portion that you are responsible to pay. If you have a claim, like your roof being replaced and its cost $10,000 in total. Then the insurance company would pay the roofer $9,000, and you would be responsible for paying the remaining $1,000 to the roofer.

Susie Adib is a Sales Producer at Commerical Insurance Associates in Chantilly, VA. Her goal is to talk with you, understand you, and help you review your insurance options and find the perfect fit for you and your family. She enjoys working with all of her customers to help educate you on your coverage needs, provide effective and efficient communication, and make sure you have a great insurance experience. Contact me today at 703-895-1956 to make sure you have the best coverage that you need!

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