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For most people their home is their most valuable asset and with an annual review consumers can save money, make sure they have the proper coverage, and can be prepared for a natural disaster. Here are the basicis that you should consider when doing your annual homeowners insurance audit:


Make sure you have enough coverage to rebuild your home. All homes are different when it comes to construction class and finishings so it's important that you find the right coverage to rebuild your home as it stands today. Some typical things to consider are square footage of living space, square footage of unfinished basement or garage and what type of additional ammenities do you have? A lot of people get confused between market value and reconstruction costs. One important thing to keep in mind is that your cost to rebuild will not include the value of your land (which your market value does). Your focus should be on the cost per square foot to rebuild based on local figures of both labor and materials. Always allow some additional monies in the event of a large storm that might impact a large section of homes. The price of materials can inflate ten-fold if storm damage causes massive damage to a large geographical area.

Are you covered for disasters? Normally, your standard homeowners policy will specifically exclude coverage from damage caused by flood, earthquake, mudslide, sinkhole, and any other form of earth movement. If you have an independent agent, they will be able to secure you a policy for these types of losses or endorse your existing policy to make sure they are included. If your home is outside of a flood zone, the chances are low that you will experience damage caused by flood and your rates will reflect that. Here are some good resources if you would like some additional information regarding insurance for these types of storm damage:

> www.floodsmart.gov
> www.fema.gov
> www.trustedchoice.com/catastrophe-insurance/all/sinkhole/
> www.disastercenter.com/guide/landslide.html

What is the right deductible for you? Many people don't realize that the higher your deductible the lower the premium. We come across a lot of consumers looking for insurance who still carry $250 or $500 deductibles on their homeowners insurance policies. Years ago these would have been the norm but nowadays we try and illustrate the savings to people if they opt for a $1000, $1500 or even a $2500 deductible. Sometimes the savings can be substantial. And some insurance companies will even waive your deductible in the event of a major claim with over $50,000 in damages. Beware of the % deductible on your homeowners policy which is normally 1% or 2% of your dwelling limit. Every year your home will adjust for inflation which will cause this % deductible to increase as well. The example we use to illustrate the out-of-pocket expense with this type of deductible is a home insured for 250,000 with a 1% deductible. In the event of a claim, you would be responsible to pay $2500 as your deductible amount. The main point here is to do your homework, check out all of the options, and see what deductible makes the most sense for you.

How much "STUFF" do you own?
 Or in other words - how much personal property do you need to insure? Most insurance companies offer a set percentage of the dwelling to cover your personal property. So the more dwelling coverage you have, the more contents coverage you have. But what if that amount is too high? Normally, the set amount on the policy is calculated within the framework of the policy so you most likely won't be able to reduce this number. But what if you don't have enough coverage? You can increase your contents coverage with a call to your agent and the cost per thousand to increase is usually pretty affordable. But what happens if you don't know if there is enough coverage? If this is the case, you should do a walk-through inventory of the home and video record your belongings and store the video on a cloud server or physically off-site. The Insurance Information Institute also offers an excellent program that allows you to catalog all of your personal property on their site or on the smartphone app. Not only is this helpful to evaluate if you have enough coverage on your policy, but also helps in the event of a claim. For more info, you can visit  https://www.knowyourstuff.org/iii/login.html for more information. 

Make sure you have enough liability coverage.
 A standard homeowners policy in the state of PA will include $100,000 of liability coverage. Is this enough coverage for you? You should have enough liability coverage to cover all of your assets in the event someone sues you. This type of coverage is very affordable and increasing the standard limit of 100,000 to 500,000 can cost as little as $4 extra per month. And if you think that 500,000 isn't enough coverage to protect all of your assets, you can ask your independent agent to include an umbrella policy in your portfolio which can add an extra $1 million and will add liability coverage to both your auto and home. Editor's note * personal injury claims have been on the rise in recent years with the proliferation of social media. The standard homeowners insurance policy will exclude personal injury claims. This is another type of coverage that you can endorse on your homeowners insurance policy or apply for a separate policy to have these types of claims covered.


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