You can never underestimate the importance of providing protection for your family, home, and personal belongings. That’s why choosing the appropriate homeowners policy is such an important decision. Allow our agency to assist you in choosing the coverage that best fits your situation.
Homeowner's insurance is a package policy covering damage to your property and liability arising from property damage or physical injury caused by you or a member of your family. The Homeowners-3 policy (140-3) is the most commonly written coverage. This policy covers your home and personal belongings from all risks, except for those specifically excluded. These specifically excluded risks include flood, earthquake, war, nuclear accident, etc. It is important to review your policy for these exclusions.
There are two ways you can insure your home or personal belongings:
- Replacement Cost - Insurance will pay for the cost of replacing the damage to your property without deduction for depreciation. Payment will be limited to a specific dollar limit listed in the policy. The Homeowner's-3 policy is almost always written using this valuation method.
- Actual Cash Value — Insurance will pay a policyholder an amount equal to the replacement cost of the damaged property minus the cost of depreciation. If a policy does not specify property is covered on a replacement basis, then coverage would be actual cash value.
It is important that you check the specific limits in the policy for items such as jewelry, furs, computer equipment, etc. It is entirely possible that you will need coverage over and above what is provided in the policy. In these situations an insured can purchase a personal property “floater.” This is an endorsement to the policy allowing you to insure specific valuable items separately at a higher limit. The floater may also provide coverage for additional risks that are not in the standard policy. For example, a homeowner's policy will typically provide insurance for jewelry with a $1,000 limit. By adding the endorsement, you can increase your jewelry coverage to reflect the actual value contained in your home.
Due to certain factors, a home may not be eligible for the comprehensive Homeowner's-3 policy. In these cases more restrictive policies may be offered, namely the Homeowner's-2 (H0-2) and Homeowner's-I (H0-l) forms. These policies provide protection from only specified risks listed in the policy. If at all possible, you will be steered towards obtaining the H0-3 policy. It is important that you inquire within our agency, so we can assist you in molding a policy that best protects you and your family members.
Personal Articles Floater
A Personal Articles Floater is a policy designed to cover classes of property such as jewelry, furs, cameras, musical instruments, and arts. This policy typically provides all risk property insurance on an agreed value basis. As always, all covered claims are subject to a policy deductible.
It is important to mention that although you may have a Comprehensive Homeowner's Policy, coverage for damage to jewelry, furs, cameras, musical instruments, and arts may be limited or excluded entirely. A Personal Articles Floater ensures that articles of this kind are insured to an adequate limit of insurance and are covered at all locations. This policy helps eliminate gaps in coverage in your Comprehensive Homeowner's Policy.