Understand What You’re Buying.
Know the Policy.
Before deciding on a particular policy, homeowners should know exactly what that policy will give them. Standard policies provide coverage for things like lightning, hail, explosions and theft. They don’t cover floods or earthquakes. For these, homeowners need separate policies. (Studies show that only 20% of homeowners in flood-prone areas have flood insurance, even though the risk of flood is 26x the risk of fire).
Don’t Be Fooled.
Insure a home for what it would cost to rebuild it, not the mortgage amount or market value. According to a study conducted by Marshall & Swift/Boeckh, as many as 75% of U.S. homeowners have insurance policies that wouldn’t cover the cost of rebuilding if a fire or storm leveled their home. St. Johns Insurance agents work closely with customers to determine their home’s replacement value.
One way to compile a quick estimate is to multiply the total square footage of the home by local building costs per square foot. Bear in mind, however, considerations such as the type of construction, improvements, special custom features, etc., aren’t reflected in a generic cost-per-square-foot estimate. If you really want to ensure your peace of mind, it’s critical to consult with an insurance agent who has access to resources used in calculating a home’s replacement value.
Entitled to Discounts?
There are a wide range of discounts that homeowners may qualify for when working with St. Johns. There are discounts for newer homes, homes equipped with hurricane shutters, fire and burglar alarms, as well as homes built to new Building Code standards – just to name a few. St. Johns rewards homeowners who have gone the extra mile to make their homes safe.
How much are belongings worth?
Generally, homeowners’ policies give coverage for the insured’s belongings equal to anywhere from 25% to 75% of the amount of insurance on the home. To decide what’s right for each individual homeowner, the insured are encouraged to compile a video or written inventory of everything they own that includes what it would cost to replace those items. Homeowners should consider insuring belongings on a replacement cost coverage basis. While it generally costs a little more, homeowners will be reimbursed for what it costs to replace the item with no deduction for depreciation if they do have a claim.
Ensure You’re Not Underinsured.
If someone is injured on a homeowner’s property and that homeowner is not properly insured, it could cost hundreds of thousands of dollars. Basic homeowners’ policies give $100,000.00 worth of liability insurance. Increasing liability coverage to $300,000.00 or $500,000.00 is generally worth the relatively small increase in cost.
If a home needs to be repaired or replaced, the cost of improvements needed to comply with current building codes may not be covered by a standard homeowners’ policy. Homeowners should contact their St. Johns agent to learn more about how Ordinance or Law coverage can help relieve the additional cost for demolition and/or increased construction costs because of newer building code enforcement or ordinances when repairing or replacing your dwelling after a covered loss.
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