When looking into a new homeowners policy, there are things that need to be asked. Please take a look at our quick guide, but when it comes time to shop for new insurance, be sure to reach out so we can make sure you have all the coverage you need.
What is my deductible?
You want to make sure that your deductible is 1%. Although 1% is the industry standard, some carriers may try to give you a 2% deductible policy. So on a 300,000 home, that is $6000 before insurance pays anything.
What is my liability limit?
A liability limit is an amount that insurance will provide to pay to defend you and any damages the courts deem if there is an accident in your home. Always make sure your homeowner's liability limit is at least $300,000. For a small amount, you can usually increase the liability limit to $500,000.
Is the policy a replacement cost policy?
Replacement cost coverage pays what it would cost to rebuild your home if there is damage from any covered source. Some policies pay actual cash value, which only pays for the depreciated value. You will also want to verify that the personal property coverage is also replacement cost.
Does this policy cover replacement cost on my roof?
Texas wind and hail storms can wreak havoc on your home's roof. Many companies have started reducing the coverage for your roof to actual cash value. As with overall policy, make sure the roof is coverage is for replacement cost.
Is water damage covered?
Some policies exclude water damage coverage or offer minimal coverage for water damage. Be sure to confirm that your policy covers 100% of the limit for sudden and accidental discharge of water. Sudden and Accidental water damage are things like a pipe bursting. In addition to sudden and accidental discharge of water, you want to ask if they offer repeated leakage and water seepage coverage. This would provide coverage for leaks that happen over an extended period. Repeated leakage and seepage of water is often added by at an extra charge. In the event of seepage, the damage is usually extensive and worth the additional cost to buy coverage.
What about damage to the foundation caused by water? This coverage is also most often added at an extra charge. Again you will want to purchase this. Adding this coverage to your policy would provide coverage for damage to your foundation caused by a covered water leak which is more common than you may think and very costly to repair.