Facts on Home Insurance Orange County Homeowners Should Know
The home insurance orange county home owners must buy can be a large part of the expense of owning a home
. Whether you are a new home owner just coming to Orange County, or have just received a renewal notice on your current policy, you should not accept the first offer you receive. There are many different items that can affect the cost of your coverage. Understanding some of the factors affecting your premium costs can help you get the coverage you really need for the most reasonable premium cost. The insurance company you choose ultimately controls the prices you will pay but the coverage you choose and what will happen when you need to file a claim are as important as the premium. Sacrificing needed coverage to save on premiums is not a wise choice and one you could ultimately regret. The terminology used may be unfamiliar to you and you need to truly understand your potential policy's coverage conditions and limits in order to understand what your premium is paying for.You should consider the worst-case scenario--total loss of the home. This is the coverage shown on the policy under dwelling coverage. In the event of catastrophic loss, being under insured could mean you are unable to rebuild your home. Homeowners who fail to fully insure the cost to rebuild their home could find themselves owning an empty lot and no home of their own. Make sure the insurance agent selling you a policy has the correct data about your home's square footage, age, materials used in construction, and any special specifications involved in the construction of your home that you would want included in any replacement home. Dwelling coverage typically covers the expected costs of labor plus materials which can fluctuate. Your policy should have some automatic coverage provisions that allow for increases in the costs of labor and materials at the time you file your claim. For example, a policy may include a provision that the actual replacement cost could be 25 percent higher than the listed dwelling coverage and still be covered. Home insurance Orange County residents buy may need this buffer with the fluctuations in housing values and labor costs.
Another coverage is for personal property. This is a separate item from dwelling coverage, which applies to the actual building. Personal property coverage protects homeowners from losses of belonging not part of the actual structure, such as the usual appliances, personal effects, collectibles and furniture. Typically, insurance policies limit losses of personal property to 75 percent of the amount of the dwelling coverage. If you have items of unusual valuable, such as coins, antiques or jewelry that cause your potential loss to exceed the 75 percent figure, you can purchase additional coverage endorsements. Many insurance policies do not cover valuable personal items such as jewelry and antiques without a special personal property endorsement.
Totally separate from dwelling or personal property coverage are the liability coverage limits. Most home insurance policies Orange County residents will buy have $100,000 coverage for personal liability. Many brokers and experts recommend increasing this to $500,000. In the litigious world we live in, $100,000 may not be adequate protection if a visitor to your property suffers an injury and files a lawsuit against you. Coverage assumes, of course, that any injuries were the result of an accident and the only issue is negligence on your part that makes you liable for damages. Failure to have adequate liability coverage could destroy you financially, if a person receives a large settlement from a jury in excess of your insurance coverage. The insurance company has no obligation to pay any damaged assessed beyond the coverage limit--you will have to pay it.
The average person does not want to and does not need to understand every stipulation and provision contained in their policy. However, you should feel free to ask your agent to explain fully what would happen if, and give him or her a few scenarios that will help you understand exactly how the policy will function in the unfortunate event you have a loss from fire, wind, theft or water damage. If the unexpected occurs, at least your insurance will give you some comfort.
Facts on Home Insurance Orange County Homeowners Should Know
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