Insurance Tips that Save You Money
Is your home insured for the correct replacement value?
Your policy should provide enough coverage to completely rebuild your home at current construction costs. This is called "replacement value", and it's a good idea to review the amount any time building costs have increased.
("Cash value" coverage only pays for depreciated value. Homes are usually covered for replacement value, while cash value is more likely to apply to personal belongings, but it's best to check to be certain.)
Tip: "Inflation guard" coverage automatically adjusts your home's replacement value to account for inflation. Your policy may include this already.
Are you still insured if you go away for 30 days?
Many people don't realize that if a home is unoccupied or vacant for more than 30 days it may no longer be covered for things like vandalism, malicious mischief, or even water or fire damage.
"Vacant" usually means completely empty, whereas "unoccupied" typically means furnished and ready to be lived in. It's important to ask your insurance company how they define those two terms and how your coverage would change in each situation.
You can buy a vacant home policy or endorsement if you plan to be gone long enough that your standard coverage would be affected.
Does your policy exclude specific dog breeds?
Home insurance policies usually include liability insurance that covers the homeowner if their dog bites someone, even if it doesn't happen on their property.
Some breeds are much harder to get insurance for, however. There appears to be no universal list used by all companies, but here are the main breeds that sometimes don't qualify for coverage:
Do you need flood or earthquake insurance?
Homeowners are sometimes surprised to find out that standard home insurance doesn't cover damage caused by floods or earthquakes. Separate policies are available for those events.
(If a storm rips the roof off of a house and douses the interior with rain, that would typically be covered. What's excluded is actual flooding, including storm surges.)
Does your property contain an "attractive nuisance"?
The law says that homeowners are responsible for making sure there's nothing dangerous on the property that is accessible and attractive to children.
Attractive nuisances include:
Swimming pools, fountains, and hot tubs.
Old appliances.
Play equipment, trampolines, and treehouses.
Power tools and lawn mowers.
Non-working cars.
Scaffolding and ladders.
Making those items inaccessible or removing them entirely are the best ways to reduce liability.
Should you buy an umbrella policy?
And speaking of liability... the answer to the umbrella policy question is "Yes" for most people, simply because the coverage is relatively inexpensive compared to how hugely beneficial it can be.
An umbrella policy protects you by paying above and beyond your home and auto insurance liability limits if you're sued for major injuries, property damage, loss of income, or even defamation.
A $1 million umbrella policy typically costs between $150 and $300 a year.
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