Wednesday, 26 June 2013

Useful add-ons for your homeowners insurance policy

One of the most basic types of insurance you will buy in your lifetime is homeowners insurance. We have peace of mind in dealing with many of the calamities that may befall us in our homes. That said, we need to be careful not to assume a greater degree of coverage than we actually have. This would land us in the most unpleasant predicament of discovering we're on our own, when in fact we thought we had help. In order to be quite sure of the extent of your coverage, you should certainly speak with your insurance provider. In the meantime, Here are some guidelines as to some types of coverage that are not automatically included in your homeowners policy, which you might consider useful to purchase additional coverage for.

Natural disasters. Earthquakes, hurricanes, and tornadoes are generally not included in basic home insurance policies. Neither are mudslides. The reason for this is that you simply may not need all of these types of coverage depending on where you live. However, you should learn which of these disasters your region is prone to, and be sure to get the coverage you need. While earthquakes, hurricanes, and tornadoes rarely affect those of us living in Alberta, mudslides are definitely a pertinent condition in and around the mountains. If you have any doubts, do a little bit of research about the weather history of your area to learn which of these disasters may come about in your lifetime. A note about flooding: Flooding may be the result of natural causes (such as a hurricane) or it may be the result of a compromised building. In either case, flooding is not covered by your basic homeowners insurance policy. Unfortunately, at present, it is not possible in Canada to purchase flood insurance. This is something that definitely needs to change.

Identity theft. While basic home insurance can cover the hard costs of materials removed from your home, something like identity theft, whose costs are much trickier to calculate, is not covered by basic homeowners insurance. We recently discussed several ways that you can protect yourself against this kind of theft, including add-on coverage onto your homeowners insurance policy.

Luxury goods in your home. Jewelry, antiques, artwork, and firearms are tricky: on the one hand, they are covered under your basic home insurance policy, but on the other hand, the coverage may not reimburse you for nearly what these items are worth. Insuring them separately will help you ensure that they are replaced for their actual value to you.

Regular goods in your home. Now these items are definitely covered by your homeowners insurance policy. However, you might not get what you expect for them—especially that the reimbursement values usually take into account depreciation. This means that a computer you paid $2000 for a couple of years ago will be reimbursed for less than that. If there are certain items you want insured for a certain replacement value, talk to your insurance provider.