10 Things to Know about Insurance!!!

Ten things you should know about your insurance…

but have never been told.


As we review coverages with potential clients, many are amazed to find that they have significant gaps which can leave them open to potentially devastating financial losses. The list below represents some of the more common issues we see when reviewing policies.

Homeowner, Condominium, and Renter Insurance

1. Limited coverage for theft of jewelry.
All policies have a limit on the theft of jewelry. Most policy limits typically range from $500 to $2,500. If your jewelry is worth more, you may need to add jewelry floater coverage to your policy.

2. Contents Replacement is not automatically covered.
Policies without this coverage only provide reimbursement for the value of your belongings in their “used” condition prior to the loss. Contents Replacement coverage will reimburse you for the cost of new similar quality items if they are replaced. Some insurance companies only offer this coverage if requested.

3. All Earthquake deductibles are not equal.
Some companies determine the deductible as a percentage of the dwelling (building) coverage limit, while others determine it as a percentage of the combined total of the dwelling, contents, and loss of use coverages. For example:


Dwelling Coverage: $250,000

Contents Coverage : $175,000

Loss of Use Coverage: $50,000

Examples:

Company A offers a 15% deductible on the dwelling coverage only. The total deductible will be $37,500 ($250,000 x 15%).

Company B offers a 15% deductible on the total combined limit. The total deductible will be $71,250 ($475,000 x 15%).

The difference can up to $33,000 in Earthquake coverage.

4. Guaranteed Replacement Cost does not guarantee your home will be rebuilt.
The insurance company must know about the features of your home to cover them after a loss. For example, if you upgrade your kitchen to higher grade cabinets, counters, flooring, and appliances, the replacement cost of your home will increase. If you do not let your insurance carrier know about the improvements, they may not be covered. You should report any remodels or upgrades to your insurance company.

5. Specialized hobby collections may have limited coverage.
Sports cards, memorabilia, stamp, coin, and guns are some of the items that typically have limited coverage. Coverage may range from $100 to $2,500. Collections of higher value need more coverage to be adequately protected.

Check next week for the rest of the 10!!
Robert.