subject: Basic Coverages in a Home Insurance NY Contract [print this page] Basic Coverages in a Home Insurance NY Contract
If you own a home in New York, carrying homeowners insurance is a must. With a home being possibly the largest financial investment you will ever make in your lifetime, ensuring your investment is protected against unintentional and unexpected losses is significantly important. While you may understand that you must carry home insurance NY in order to satisfy the requirements set forth by your mortgage company, you should also have a basic understanding of how your insurance contract works in the event your home is damaged or deemed a total loss due to a covered peril listed on the policy. Below is a brief description of coverage including in a Dwelling policy and how you should determine the limits you will choose for your home.
Dwelling coverage is seen as one of the most important coverages in a home insurance NY contract. Designed to rebuild your home or repair damages from a coverage loss such as a fire or hail storm, the Dwelling limit selected is what stipulates how much will be paid to your in the event of a loss. Determining the correct dwelling limit for your home insurance contract can be difficult as you cannot reasonably forecast how much it will cost to rebuild your house to the same caliber years down the line.
Many homeowners fail to understand the rebuild cost is extremely different from the market value. Market value includes land, and because the land will still exist after a loss, you are only figuring in the costs of materials and labor to rebuild the home itself. While some agents will give you a round about figure of $200 per square foot to rebuild, it is recommended to consult contractors in the area and get a figure that will stand up to piling inflation.
Personal Property is designed to cover your belongings such as appliances, clothing, furniture, and any other assets that are not permanently attached to the building structure. Most insurance policies will include a basic coverage amount of between 50 percent and 75 percent of your Dwelling coverage when calculating personal property values. If you have valuable items such as antiques and jewelry, consider adding a rider for special coverage and increased limits of coverage. Also, choose a company which offers replacement cost rather than actual cash value on personal property, as you will not be punished for deflation on your claims payout.
Home insurance NY also requires several other coverages including personal liability, medical payments to others, loss of use and additional riders and endorsements. Knowing your limits is extremely important. Consult a license agent, catalog your personal property and consult contractors to determine the limits that will adequately protect you in the event of a catastrophic loss.
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