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Your Florida home is likely your single biggest investment, and should be a priority when it comes to safeguarding your future. The homeowners insurance policy you choose will determine how a crisis like a water leak or a catastrophe like a hurricane impacts your finances.
There are several figures that can affect both the specific insurance you choose for your home and how much you’ll end up paying for it.
If something caused the complete loss of your home, using the “actual cash value” (based on the current home market) as a measure for recompense could leave you shortchanged. Your homeowners insurance policy should provide coverage for your home’s “replacement cost value”, which includes current day costs for materials and labor, plus any requirements to bring the house up to code if it’s been grandfathered in. Ask your agent if you aren’t sure which value is being used to create your policy.
Your deductible is the amount you would be required to pay out of pocket if you file a claim. Many insurance carriers offer the option to choose a higher deductible and lower installments, which can seem like a good way to save money every year – but can come back to haunt you if you do experience a loss.
Your policy may have several different deductibles based on the kind of loss incurred. The deductible for damage caused by theft, fire, or lightning is normally represented as a dollar amount – such as $2,500 or $5,000. Deductibles for damage caused by a weather event, such as a hurricane, may be set at a certain percentage of the total loss, such as 2%.
Your homeowners insurance premium is the total you’ll pay for your policy. Some discounts may apply; many carriers offer a discount for owning a newer home, or having a home security system, for example. If you have chosen a high deductible, your insurance premiums can often be lowered, and making one annual payment may also result in a discount over paying in installments.
Your personal property coverage is designed to help protect your personal items of value – from your designer luggage to big screen TV. Create an inventory of your belongings and list their value. Compare the total to the coverage provided by your homeowners policy to ensure the coverage is adequate. For luxury items, such as expensive jewelry or fine art, you can purchase additional scheduled personal property coverage that will cover items of value that exceed a standard policy’s limitations.
All insurance policies can be expected to list exclusions. In Florida, flooding may be a real concern, but homeowners policies do not cover damage resulting from flooding. A separate policy must be purchased to obtain flood insurance in Florida and protect your home.
The more you know about how homeowners insurance works, the more confidence you can have in choosing appropriate coverage for your home. Your Olympus insurance agent can help you determine true replacement cost value, set your deductible, opt in or out of additional scheduled personal property coverage, find flood insurance if required or desired, and settle on a premium that fits your needs.
This article is for informational purposes only and does not form a part of, replace, change or amend any terms, conditions, provisions or language within your Olympus Insurance policy. We encourage you to read your entire policy.