For most people, your home is your biggest asset. Understanding what your homeowner's insurance policy does - and does not - cover is key to protecting that asset.
A typical homeowner's insurance policy provides coverage for damage caused by common perils such as fire, wind and hail. Most homeowner's policies DO NOT cover damage caused by flooding. Homeowner's policies usually provide separate coverage for your home, for other structures on your property, for personal property or contents in your home, and for additional living expenses you may incur if your home is damaged by a covered peril and you are unable to live in your home while it is being repaired. Also, these policies typically provide liability coverage for accidents that may occur at your home. Each of these separate coverages will have a separate policy limit - that is, the limit the insurance company will have to pay in the event of a loss (minus a deductible if you have one).
It is very important that you periodically review your policy limits to make sure that you have enough coverage to replace your home and its contents in the event that they are totally destroyed. If you have made additions or renovations to your home, you may want to have it appraised and upgrade your insurance coverage to reflect the increased value of your home. Your insurance agent can assist you with this.
Most homeowner's policies exclude coverage for damage caused by certain perils such as flood, termites or settling, which are common perils in south Louisiana and other areas. Many homeowner's policies also exclude coverage from damage caused by a covered peril, such as wind, if that damage is also caused in part by an excluded peril, such as flooding, and the damage from wind and the damage from flooding occurs "concurrently," or at the same time. You should consult your homeowner's policy, under the section entitled "Exclusions," to find out what your policy does not cover.
A homeowner's insurance policy is a legally binding contract between the homeowner and the insurance company, and the terms of this contract can be difficult to comprehend. If you have questions about certain terms and conditions in your insurance policy, you should consult your agent or an attorney who has experience with these specialized contracts and the laws that apply to them.
It is a good idea to keep your homeowner's policy, other insurance policies and an itemized list and photos of your personal property, such as furnishings, clothing and valuables, in a safe place, such as a safe deposit box. Some homeowners periodically videotape and/or photograph their home and personal possessions as a precaution in the event of a future loss. If your home is damaged, it is prudent to immediately call your agent, broker or insurance company about filing a claim. The "Declarations" page of your insurance policy may provide an 800 number that you can call to make a claim directly with your insurance company.
In order to document all damage to your property you should:
- Take photographs and video of all damages to your home, additional structures and personal property or contents.
- Make a list of all personal property or contents that were damaged, along with their age and estimated value.
- Save all estimates and receipts for repairs made to your home and other structures and for replacement of your personal property or contents.
If you have to evacuate your home, save all of your receipts for food, lodging, travel and other additional living expenses.
