Most homeowners’ insurance policies provide coverage for your personal possessions at approximately 50 to 70% of the amount of insurance you have on the structure of your home. The best way to ensure that you have the right cover is by conducting a home inventory. This details everything you own and the estimated cost to replace these items if they are stolen or destroyed.
Make sure that you know the difference between “cash value” or “replacement cost” insurance.
Consider if you need extra coverage for certain valuables. Make sure that you ask about coverage limits on luxury items.
Consider the costs of additional living expenses if you need to temporarily live away from your home if you can’t stay in it due to damage caused by disaster.
Consider the amount of liability insurance you have, to protect your assets.
Check your credit rating. Keep in mind that your credit rating affects your insurance premiums. If you have a good credit rating you may be charged lower premiums.
Check your claims history. Your homeowners’ insurance costs may be affected by how often you’ve claimed in the past.
Consider the age of the house. For new homeowners, their insurance costs may be lower, compared to older homes. For instance, older homes may require more money to replace items lost or damaged, especially if they haven’t been maintained very well over the years.
Homes with safety devices are considered to be low risk. If you have a smoke detector or an alarm system fitted in your home, you may benefit from lower homeowners’ insurance.
It’s important to shop around for the best coverage for your individual needs. You should also ask about available discounts. A rule of thumb is to get enough insurance to completely rebuild the house or replace everything in the house.