Do I Have the Right Coverage and Protection from My NJ Homeowners Policy?
It’s hard to understate the importance of a home. Our homes provide shelter for our families, sanctuary for our children, and memories that shape our lives. We expect to have safety and comfort at home through all seasons. At Danskin Agency, we want to make sure that all of our clients have a homeowners’ insurance policy that provides the level of protection they would expect for something as important as their family home.
At Danskin Agency, we take the time to meet with you, understand what you need from your homeowners policy and find the best coverage option for you. We represent dozens of insurance companies, so we’re able to find the right coverage at the best rates. Being located at the Shore, we are especially proficient at covering coastal properties. Below we share the things we look at to find the right policy and coverage options.
Coverage for your Dwelling
First, a review is necessary to determine what it would cost to rebuild your home. Standard homeowner’s policies provide coverage for homes that are destroyed in disasters like fires, wind or lightning, but not for flood damage. If you live near a flood zone in New Jersey, you may also need flood insurance.
Sometimes, it can be challenging to understand the total expense required to build a new home. The price you paid for your house includes the land it is situated on and does not reflect the cost to reconstruct your home with like kind and quality. In Monmouth County, the average cost for replacement is now averaging nearly $200/square foot. Your insurance agent will assist in determining a coverage limit for the structure of your home, but we recommend doing your own research as well. Consider local construction costs, the square footage, whether custom construction or not and improvements you’ve made over time. Many insurance companies require the completion of a “cost estimator” to help determine the replacement cost of a dwelling.
Coverage for Your Possessions
Next, we look at everything you own in and around your home. Standard homeowner’s policies provide coverage for your belongings. Your Personal Property, also referred to on some policy forms as Contents, includes most everything you own that stays in and around your home; it does not include vehicles, most watercraft and some other items that are not specifically part of your home. Typically, the value of your belongings is around 50 to 75 percent of the value on your dwelling, but in some cases this may not be enough.
At Danskin Agency, we recommend that our clients do a general home inventory. It may be tedious, but by investing a little time we can put together a list of the important things in your house. As things change, all you have to do is update the inventory. A detailed list of your belongings allows you to see what you have and the coverage you need. A shortcut to accomplish this process may be to video each room with a narrative describing what is being videoed.
Coverage for High Value Items
We are often asked about whether certain expensive items are covered under a client’s homeowner’s policy. Is our very expensive engagement ring covered? How about my gun collection? Would our expensive paintings be replaced?
Most homeowner’s policies have sub limits for certain items, such as cash, jewelry, and firearms. For example, a typical sub limit for jewelry is $1,500. If you have an engagement ring worth $5,000, we would recommend an endorsement to cover the ring and all other expensive jewelry in your home. Your agent will sit down with you and create a schedule for anything you own requiring additional coverage beyond what your homeowner’s policy will provide.
The liability part of your homeowners insurance covers you and your family from lawsuits for property damage or bodily injury. If someone is at your home and gets injured, they could sue for their damages. The liability coverage in your homeowner’s policy is essential to protect you from financial loss.
Most homeowner policies also include Medical Payments Coverage, or as some refer to it as “goodwill insurance.” This coverage will pay medical bills, without regard to fault, for your guests that may be injured on your premises. Many times reimbursing someone’s medical bills will forestall the injured parties from suing the homeowner.
You should have enough liability insurance to protect your assets. How much do you need? The Insurance Information Institute recommends $300,000 to $500,000. We recommend even higher limits for many of our clients. If additional liability coverage is desirable, a personal umbrella policy can be added, which will provide liability coverage in excess of both homeowners, personal auto liability limits, watercraft (if any) and possibly other owned recreational vehicles.
Other Policy Options and Features
Today’s marketplace for homeowners insurance is competitive, and many of our insurance carriers are providing more coverage options. For example, the unfortunate event of a sewer backup is an all too common occurrence. Many carriers have responded by making this coverage, which was commonly excluded, available under sub limits of $5,000 to $25,000. In addition, carriers can now provide coverage options for additional theft coverage, underground piping & electrical lines, watercraft, identity theft, and even pets. When your agent has a good understanding of your needs, more options are available than ever before to make sure you have the right coverage.
Additional Living Expenses (ALE)
ALE pays the additional costs of living somewhere else if you can’t live in your home. For example, if your home is damaged in a fire, ALE will pay for the hotel, temporary rental and food while your structure is being rebuilt. Most policies provide 20 percent of the building insurance limit on your home, but this can vary depending on your insurer.
Please don’t wait until it’s too late to discover that you don’t have enough or the proper insurance. Talk to an insurance agent from Danskin Agency today to learn about your coverage options.