How To Insure Your Home Essays Examples

In order to choose the best way to insure your house, you have to choose what you want to insure. HO-3 policy can insure you against the problems, such as fallen trees and fires. In addition, a standard homeowners policy protects you from theft, but does not protect against earthquakes and floods. However, a standard homeowners policy covers the costs only within the limit. In this, if you have some jewelry, then you need to insure them separately.
Home insurance is not a mandatory procedure, in contrast to the compulsory car insurance, or health insurance. But mortgage companies will require you to have the homeowners insurance, if you apply for a loan. In addition, if one of your guests falls and becomes injured, while staying in your house, and then the guest files a lawsuit in court to get reimbursement for medical expenses, the homeowners insurance will cover all of your expenses and your injured guest’s, too. So, you insure your liability.
The next step, you have to determine, how much coverage you want to get. The best option is insurance Guaranteed Replacement Cost Coverage, according to which the insurance company fully covers all costs for the restoration of your home, regardless of the amount. But, it is very difficult to find these days the insurance companies that provide this type of insurance. There are, commonly, two types of insurance: Extended Replacement Coverage, and Inflation Guarantee (or Guard). Extended Replacement Coverage covers only 125% of the value of your home, and the Guard covers your expenses at the market value.
When you select the insurance type and the type of coverage, you need to select one of the two options for coverage. There's "replacement cost" and "actual cash value". If you choose the actual cash value, the insurance company will cover your expenses for the restoration of your house, on the amount that you could get, if you sold your house. Please note that this amount would probably not be enough to fully reset your home. Actual cash value means that you’ll get insurance coverage in the amount you would receive, if you bought your house, and all things in it from the store. This option is much better than the actual cash value coverage, because it completely covers all the costs for the restoration of your home.
In addition, I believe that it is necessary to insure also your liability. If your guest gets injured, while staying in your house, he can file a lawsuit to recover his medical expenses. Liability Coverage covers the cost, if the court sentenced you to cover the costs of the injured guest. The standard policy proposal is $ 100,000 - $ 300,000 of liability coverage.
The amount of insurance contributions depends on the type and amount of insurance coverage you own. In addition, if you own a car with insurance, the premium size increases significantly. If you do not own a car with insurance, the insurance cover will be relatively cheap (about $ 100 per year). Car owners have to pay about $ 300- $ 400 per year in insurance contributions.
It is important to know that you should refer not so often to the insurance company for compensation, for any small amount of damages. Your monthly payments may increase significantly because of this, or the insurance company may refuse to cooperate with you, because you are too risky. This means that, if the reimbursement is not big and you can pay for it yourself, then it is much more convenient and cheaper to do it yourself.
I believe that insurance coverage is necessary for each of us. It would be best to use Inflation Guarantee Coverage, than you would be completely safe from the possible natural disasters. In addition, for the best protection you need to use replacement cost coverage and insure all the valuables in your house.