072: Homeowner’s Insurance Basics
In the next few weeks I’d like to spend some time going over Risk Management for personal property such as homes, vehicles, valuables the type of protection you should think about and what type of insurance will make sense to get.
Let’s start with the roof over our head! We all need a place to live. It can be a home that you own, or rent. The focus I want to keep is an insurance and making sure you have the appropriate coverage.
In the US you can’t own a home without having Homeowner’s insurance. In other parts of the world you can. The reason being is because the losses in case of accidents can be significant and most of us can’t financially handle them.
I see this very often with my clients; they have various insurance plans, but in many cases the coverage in not appropriate.
Let’s start with Homeowner's insurance.
This type of insurance is designed to protect you in case:
Something happens to the structure itself (the building)- Dwelling coverage
When you look at your policy you will see a certain number listed there, for example $500,000. That means, your home/structure is insured for that much.
Now, the question is that enough coverage? The cost of construction is constantly going up, the value of homes increase, as well.
That’s your homework for today, if you own an home, take out your policy and take a look at how much dwelling coverage you have.