Few things are more important in the realm of financial protection than having a solid homeowner’s insurance policy. In the event of a tornado, fire, theft or other unforeseen disaster, you’ll need a policy in place to safeguard against draining your savings and upending your financial goals. However, not all insurance policies are the same, so it’s important to know these key items about your particular homeowner’s insurance policy:
What Your Policy Covers
Typically, insurance policies will cover damage to your home caused by natural disasters. However, many policies don’t include flood coverage. If you live in a flood plain, you may want to invest in a separate policy. Likewise, many homeowner’s policies provide full coverage for belongings, but many require a separate type of policy for jewelry or other valuables.
What it Does NOT Cover
Most policies will exclude earthquakes, landslides and power failures from coverage. Many exclude windstorm coverage in areas prone to tornadoes or hurricanes, requiring homeowners to maintain supplemental insurance for such damage caused by these events.
The Importance of Recordkeeping
All too often, homeowners see legitimate claims rejected simply because they couldn’t provide proper documentation. Always save receipts, contracts and appraisals for big-ticket items and, if an unforeseen loss occurs, document any steps you take to mitigate damages.
When and How to File a Claim
Naturally, insurance companies don’t have much patience for frivolous claims, and it’s possible that your rates will rise if you’re a habitual offender. However, you’ll certainly want to file in the event of a true disaster, and you should consider filing for legitimate, but lesser, damage to your property, too. Be sure you understand how and when to do so.
Knowing the ins and outs of your homeowner’s insurance policy is a key step in being a responsible homeowner, and in protecting your financial future. If you have questions about your policy, be sure to contact your insurance provider today.
Image via Flickr/Greg Buck
