Homeowner's insurance or renter's insurance is a necessity that covers you in unexpected occurrences ranging from robberies to fires. When it comes to assessing whether you have adequate coverage, though, the devil is in the details. For example, did you know that most of these plans do not cover floods or earthquakes? Or that some cover fire damage but not wildfire damage? It is important to review your coverage and be certain that you have the best level of protection you can afford. Here are five tips to get your home insurance organized.
Sarah Welch and Alicia Rockmore, Scripps Howard News Service
1Watch What You Claim. If you make a lot of small claims, you may exhaust your insurance funds faster than anticipated — or you may even be dropped from the plan. Making a lot of claims also may cause your premiums to increase significantly. Look carefully at your plan before you make a claim, or talk to your agent about the effect of small claims on your coverage.
2Take Inventory. Do you know exactly what is in your home? Write from memory everything of value in your living room, from electronics to DVDs. Now take that list to the living room. Did you remember it all? Imagine doing that for your entire home after a fire. Take photos of every room in your home and record a complete inventory. Also keep proofs of purchase for anything more than $200 and get appraisals on luxury items like jewelry. Put this information in one binder you can grab at a moment's notice.
3Determine Exactly What IS Covered. Insurance packets and their corresponding Web sites can be highly confusing, full of legal terms and complicated scenarios. Schedule an appointment with your agent and discuss the ins and outs of your current coverage. Be sure to bring your valuables binder with your home inventory, and discuss events that aren't covered by your current plan, like sewage intrusion, hurricanes, floods, earthquakes, etc.
4Equip and Prepare. Owning insurance is but one piece of the puzzle. In Florida, your home should have proper roofing reinforcements and windows in case of a hurricane or severe storms. An alarm system means fire departments will be quickly alerted to flames and the police to burglaries. These defenses come with a bonus: They can lower your insurance rates dramatically.
5Have an Insurance Assessor on Deck. With your inventory binder, keep the contact information of a trusted insurance assessor who is not affiliated with your insurance provider. If you ever need to file a claim, have that third party assess your damage immediately. Your insurance company is going to do the same, and it will try to pay you back as little as possible. Cover your bases by having another professional document the claim and cost.