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DO I HAVE ENOUGH HOMEOWNERS INSURANCE ?
It is that time of year when the calm of spring gives way to the storms of summer . With storms comes damage from fire , wind , flooding , and lightning just to name a few perils . Your home is your single largest investment . How do you know if you have enough insurance to cover losses ? This article will focus on damage to the structure of your home . You should also be aware that a homeowner policy provides coverage for theft or damage to personal property , and liability for injuries sustained by individuals while on your property .
So how much insurance do you need ? The quick answer is you need enough insurance to cover the cost of rebuilding your home at current construction costs . The cost of rebuilding could be more or less than the price you paid or could sell it for today . Banks and mortgage companies may only require you to buy enough insurance to cover the amount of your mortgage . If you base the amount of insurance you purchase on the amount of your mortgage , make sure it ’ s enough to cover the cost of rebuilding . Most homeowners are aware of their home ’ s value when they first purchase it , however , as time goes on the value changes . Adding an addition to your home , ever changing construction cost and changes to building codes all affect the value of your home . Living in hurricane prone areas like Florida makes it especially important for homeowners to secure proper limits and specialty coverages . The basic homeowner insurance policy provides coverage for damage due to fire , lightning , hail , explosions and theft . Damage due to floods , earthquakes or damage caused by lack of routine maintenance is generally excluded , or requires you to purchase additional coverages . Therefore , it is important to periodically review your policy with your insurance agent to ensure you are adequately covered .
Generally , damage to your home is based on replacement cost , which means that in the event of a total loss , your policy will provide reimbursement , up to the policy limit , to replace the structure . Ideally , a homeowner should buy enough insurance to completely rebuild the home , known as replacement value . This figure may not be the home ’ s actual market value or what you originally paid for the home . This is especially true in a depressed or an inflated market or if the home is simply not replaceable to its condition prior to the loss . For example , if you are insured with replacement cost coverage , if the structure of your home is insured for $ 300,000.00 , the insurance company will designate a percentage of additional coverage on top of the insured amount . If the company designated 125 % replacement cost coverage , then you would receive an additional $ 75,000.00 , or a total of $ 375,000.00 . Replacement coverage can be purchased for as high as 200 %.
In Florida , most homeowner policies have a hurricane deductible . Most Florida homeowners have a 2 % deductible , which means that if your home is insured for $ 300,000.00 , and your home is damaged due to a hurricane , then you are responsible for the first $ 6,000.00 of your loss . Additionally , the standard policy does not cover damage caused by flood . Storm surge from a hurricane is also considered flood damage and not covered by your homeowner ’ s policy . This coverage must be purchased separately through the Federal Government ’ s Flood Insurance Program .
For a quick estimate of the amount of insurance you need , multiply the total square footage of your home by local building costs per square foot . To find out construction costs in your community , call your local real estate agent , builders association or insurance agent . Factors that will determine the cost of rebuilding your home : »» Local construction costs »» The square footage of the structure »» The type of exterior wall construction – frame , masonry or veneer »» The style of the house »» The type of roof and materials used »» Other structures on the premises such as garages , sheds »» Fireplaces , exterior trim and other special features like arched windows »» Whether the house , or parts of it like the kitchen , was custom built »» Improvement to your home
Call your agent and review your homeowner policy periodically . You should stay up-to-date on your insurance because you never know when you will need to rely on it . Should you encounter problems making a claim for damages to your home , feel free to contact us for a free consultation .
At Byrd & Gonzalez , P . A , we are experienced in handling personal injury and property damage claims resulting from an accident . If you are injured in an accident , call and speak with us for a free consultation , before speaking with an insurance company .
Anthony J . Gonzalez , Jr ., Esq . Board Certified Civil Trial Lawyer Byrd & Gonzalez , P . A . 217 N . Lois Avenue Tampa , FL 33609 Phone : ( 813 ) 281-8801 AskElAbogado @ thelatinvillage . com www . byrdandgonzalezlaw . com
Disclaimer note : The hiring of a lawyer is an important decision that should not be based solely upon advertisements . Before you decide , ask us to send you written information about our qualifications and experience .
12 LATIN TIMES MAGAZINE | May - July 2008