You buy homeowner's insurance to protect your biggest asset, so it’s important to purchase enough coverage to suit your needs. By looking at a few key factors, you could end up saving yourself a lot of money and heartache should you ever have to make a major homeowner's insurance claim. Be smart and ask yourself the following four questions when considering how much coverage to purchase.

How much will it cost to rebuild?
When you’re figuring out the cost to rebuild your home, use current construction prices. Don’t add in the cost of the land, and don’t base your cost estimates on how much you originally paid for the house.
Even though your mortgage lender may require you to have homeowner's insurance, you still may not be adequately protected. In most cases, the policy limit is the amount owed on your mortgage, which may not be enough to rebuild at current prices. To estimate the amount of insurance you need, multiply the total square footage of your home by the building costs per square foot. You can get information about local building costs by calling your real estate agent or home builders association.

You should select an extended replacement cost policy for several reasons:

• It pays for your home to be repaired with materials that are similar in kind and quality to what was originally used.
• There is no deduction for depreciation or wear and tear.
• If the demand for materials and construction workers exceeds the supply because of a widespread disaster, and prices skyrocket, an extended replacement cost policy will pay whatever is necessary to restore your home to its original condition.

How much will it cost to replace my personal possessions?
Most homeowner's insurance policies cover your personal possessions for 50 to 70 percent of the total coverage amount on your home. Conducting a home inventory will help you determine if this is enough. Create a detailed list of everything you own and how much it will cost to replace these items should they be stolen or destroyed. If you feel you are underinsured, ask you agent about increasing the coverage limits for your possessions.

Will I have any additional living expenses as a result of an insured disaster that damages my home?
When a disaster strikes, you may be forced to live somewhere else while your home is being repaired. Standard homeowner's policies covers hotel bills, restaurant meals and other living expenses incurred while you are living away from home. In addition, if you rent out the property that was damaged, this coverage will reimburse you for any rent you would have received from tenants while the home is being repaired.

Additional living expenses coverage varies among companies. The standard is 20 percent of the total amount of coverage on your house. There are also policies that cover unlimited additional living expenses for a specific period of time. 

Ask your insurance agent to tell you how much coverage you have and how long the coverage stays in effect. If you don’t feel you have sufficient coverage for additional living expenses, consider increasing it.

How much coverage do I have in the event I am named in a lawsuit for bodily injury or property damage caused to others?
The standard homeowner's policy covers you, your family members, and your pets in the event of injury caused to others. The coverage extends to both the cost of defending the case in court and any damages you are required to pay. The majority of homeowner's insurance policies provide $100,000 worth of liability insurance; however, you can get higher amounts. Conventional wisdom says that homeowners should carry at least $300,000 to $500,000 worth of liability protection.

Experts say that repair people who offer to pay insurance deductibles with the intention of enticing consumers to sign contracts for damaged homes and cars open the door to fraud. In addition to this, the practice makes insurance premiums rise. These inducements will eventually result in poor business practices, and they will hurt most of the country's insurance consumers. In some states, there are bills being considered that would classify inducements as insurance fraud. Many insurance companies, lawmakers and consumers encourage the passage of these bills in all states. Since rebating deductibles has become such a major problem in so many different areas, more than five states have already passed these types of bills in recent years.

Dishonest repair providers in home contracting businesses and auto body shops have often told unwary customers that signing contracts with the offer to pay insurance deductibles is acceptable. In most cases, this claim is an attempt to obtain new business and also bill the insurance company with a fraudulent request. Since the individuals who typically do these things are known for shoddy work, consumers also come out on the losing end of the bargain. In many cases, a repair person will exaggerate the cost of a project to cover the deductible. Insurers pass these inflated and fraudulent costs along to policyholders through higher premiums, so consumers are ultimately the ones who are hit the hardest.

Premium rebates can put a person's safety on the line in many other ways. For example, a repair person who completes shoddy repairs on a consumer's car could cause more than financial problems. If the shoddy repairs affect vital functions of the vehicle, the consumer and his or her family will be driving in an unsafe car. Serious accidents could happen, and some accidents have resulted in fatalities. Even if a consumer lived through an accident, he or she might still have to pay for medical expenses, lost time at work, vehicle damages and other costs associated with such an incident. 

Honest repair businesses that refuse to offer inducements still face the competition of working against providers who offer more enticing prices. While they are not even similar in the quality of work provided, many consumers do not know this. For this reason, it is in the best interest of every small business specializing in contracting or auto repair to alert consumers about dishonest providers. As a rule, consumers should always remember that businesses performing quality work do not need to offer incentives for insurance-related work. Word of mouth is an excellent source of advertisement for these companies or individuals, so consumers should do their homework before selecting providers. For answers to any questions on these topics, discuss concerns with an agent.

Although many homeowners think their insurance policies cover sewer backups, they are disappointed when they find out the hard way that sewer backups are not covered. However, there is separate coverage available for this type of problem. When compared to the cost of dealing with a major sewer backup, the cost of additional coverage is very small. Homeowners must maintain and repair the part of the pipeline that connects pipes in their homes to main sewer lines. The parts that connect them are also included. Since a backup can be very costly and messy to deal with, it is important for homeowners to know how to prevent a sewer backup and to understand what causes them. 

Tree Roots Interfering With Pipelines
Since trees live on water, their roots typically move toward water sources such as sewer lines. The growth may only start as a few small roots penetrating the pipeline. However, the end result is the roots growing thicker and expanding over time. When a tree root grows so much it spans the inside of the pipeline, it may cause a major blockage or a total clog. If the roots causing the problems are from trees owned by the city, it is important to contact the city's cleanup department promptly. In most cases, they sample the roots to determine who owns the tree and who is responsible for the cleanup bill. If multiple trees owned by the homeowner and the city are both involved, the two parties must split the cleanup bill.

Main Blockages
In the sanitary main, there are many different types of possible blockages. The blockages cause sewage to back up into the home. Since the occurrence is gradual, there is still time to call a plumbing specialist before the house is completely flooded with sewage. There may be water coming in through the basement when this happens. If water is coming in, call the public works office promptly.

Rain Clogging Storm Sewers
If a storm sewer cannot contain the falling rain, a sanitary sewer backup can happen. When this happens, water usually comes into the home through bathtubs, toilets and sump wells located in the basement. Damage is typically confined to the basement but can also be located in other parts of the home. Making sure there is a sump pump and generator available will help prevent the problem.

All of these sewer problems can be very expensive to deal with. Standing water and sewage are health hazards and can destroy almost everything they come into contact with in the home. By calculating the cost to replace items that are damaged and comparing that number to the cost of purchasing additional insurance, it is easy to see what a great investment insurance is. To learn more about this valuable form of coverage and what it entails, discuss concerns with an agent.

As life circumstances change, it is important to review insurance coverage. There are several issues every policyholder should consider when doing this. 

Marital Status
Married drivers typically qualify for auto insurance discounts. If couples have two cars, it is usually best to insure them on the same policy. With home insurance, it is important to update coverage, and be sure to consider any new valuables for coverage increases. Life insurance is also an important topic after marriage. Both working and non-working spouses should have life coverage, and this is especially true with couples who have or plan to have children. The death of a working spouse means a loss of income, and the death of a spouse who stays home to care for children means the loss of a care provider and the need to pay for childcare expenses.

Children
People who have children or add more to their family must consider life insurance. It is important to keep the amount updated for future beneficiaries. Also, it is important to consider disability insurance increases with every child added to a family. In the event of the main earner becoming disabled, there will still be adequate income. This is not true if people plan to rely solely on government disability benefits. When children become teens, it is cheaper for parents to add them to their auto policies than to let the teens buy their own coverage. Parents may also qualify for a discount when the teens are away to college or not around to drive for a certain period of time. 

Income Changes
People who have disability and life insurance through a former employer can replace that coverage with individual policies. For people who receive an income increase or take on additional financial commitments, it important to review and adjust coverage as needed. In the event of an income decrease, some people wish to cut their premiums. A good choice for this is term life insurance.

Living Changes
Major home improvements call for additional or adjusted insurance coverage. It is important to avoid being under-insured. Be sure to count new structures on the property. Whether it is adding a shed or improving a garage, be sure to report it to the insurance company and make adjustments accordingly. Large purchases such as furniture may also need additional coverage. People who plan to buy a second home should research insurance costs for that home before making a purchase, and flood insurance is a smart choice for homes near water or in flood-prone areas.

Valuables
After purchasing valuables such as fine art, antiques, jewelry, firearms and expensive electronics, it is important to have them properly insured. Standard home insurance policies only offer limited coverage for these items, so it is wise to obtain a separate policy or endorsement for them. All items must be appraised with receipts before doing this.

Renting
People who rent are not protected by the property owner's insurance for the building. While the building itself is covered, the belongings of the renters are not. Purchasing renters' insurance is a smart idea. Renters can choose from insuring their items for actual cash value or replacement costs. Discuss these options with an agent to determine which is best.

Regardless of where you live in the US, there is a constant threat of termites or wood-boring beetles infiltrating your home. Termites account for about $1 billion a year in damage to American homes and now that an invasive species from Asia has made it to North American shores, the threat is larger than ever. A typical termite colony can eat through 2.3 linear feet of 2x4 pine in a single year. It may not seem like much, but they will often spread to more woodwork and if they start munching on a supporting beam, the entire house structure is at risk. 

To make sure that your home keeps these hungry critters at bay, you need to protect it from making it a tempting smorgasbord for termites. You would be well advised to heed the following tips: 

Keep your yard clear of scrap lumber - Never bury scrap wood or waste lumber in your yard, and avoid keeping piles of wood in your yard as it will attract termites. Store this wood and any firewood away from the house and make sure that there is a barrier between the wood and the ground. 

Get rid of decaying vegetation - On a regular basis, clear fallen branches or decaying plants near the side of your house. 

Keep mulch piles far from the home - If you do have a pile of mulch for your gardening, make sure that you place it in a corner of your yard far away from your home. And when you do use mulch, don't spread it alongside your house if you have vegetation that abuts against the home's exterior.

Use treated lumber - Use treated lumber for any wooden structures that will have direct contact with the ground. The chemicals used to treat this wood are not 100% foolproof, but they can deter termites nonetheless. They can act as a deterrent when used in wooden decks and patios.

Avoid wood contact with ground - It's best if you make sure that no wooden structures actually touch soil, especially if you have a deck attached to your home. Use concrete supports that raise the wooden support beams for decks and patios off the ground. 

Fix water leaks - Termites need water too, so fix any water leaks in and around your home.  

Hire a pest control operator - Contract with a pest control service that will come to your house four times a year to spray for insects. 

Maintain your home - Routinely inspect the foundation of your home for signs of mud tubes (used by termites to reach a food source), uneven or bubbling paint and wood that sounds hollow when tapped. Fix leaky gutters, ensure that your attic is well ventilated, and seal cracks or holes in Regardless of where you live in the US, there is a constant threat of termites or wood-boring beetles infiltrating your home.

Do's and Don'ts When Filing a Claim
If your home or property has been affected by wildfires, you're likely planning to file an insurance claim. Here are some tips to help you maximize your compensation and get your settlement in a timely manner.

1. Safety first. Don't re-enter your fire-damaged home without first checking with fire officials. They will schedule an initial walk-through with you. Before you go in to your fire-damaged home, read this Red Cross guide:  

http://www.redcross.org/images/MEDIA_CustomProductCatalog/m38840101_picking-up-the-pieces-after-a-fire.pdf

2. Prevent further damage. You have a duty to prevent unnecessary damage to your property, so:

• Promptly clean up accumulated water.  
• Tarp or cover roof holes as necessary to keep water from getting into the interior. 
• Move any intact property away from open or broken windows or holes in the roof so it does not get damaged by subsequent rain.  
• Replace or board up broken windows
• Keep vandals and squatters out of the property. Repair fencing, gates and access, as necessary. 

​3. Gather information. Document your claims, as much as possible. To begin with, your initial claim request will require the following information: 

• Date of loss
• Type of loss or damage (e.g., fire, smoke, water)
• Location of damage
• Injuries, if applicable
• Other parties involved (witnesses, fire department officials, etc.)
• Condition of the home, prior to the incident
• Itemized list of damaged or destroyed property
• Any temporary repairs made, the reason for these repairs, and their cost
• Official police or fire inspector reports. 

4. Call us or your carrier. Don't delay filing your claim. The sooner you file for reimbursement, the sooner you will receive it. 

5. Take notes. Write down the claim number, and keep careful notes of every conversation, including whom you spoke with by name. 

6. Throw nothing away. Don't discard anything until it's been inspected by an appraiser. 

7. Claim smoke and water damages. Just because property was not directly damaged by flame doesn't mean it's not covered under your property insurance policy. You may have to throw away furniture, drapes and carpeting, replace flooring, drywall and wallpaper, and undergo expensive mold remediation. Account for all fire damage. 

8. Assess the value of any lost trees or shrubs. These are also generally covered by homeowner's insurance policies. 

9. Don't forget outbuildings. Include damaged or destroyed sheds, storage buildings, detached garages - as well as their contents - and even septic tanks and systems in your claim. 

10. Check your car. If you have comprehensive coverage on your car, your auto insurance carrier should reimburse you for the fair market value of a totaled vehicle, or pay for damages (subtracting your deductible.) 

11. Get an advance payment. Most insurers will advance you a substantial amount even while your final claim is still being processed. This allows you to start repairs right away to prevent further damage to your home, and may help you pay unexpected expenses such as emergency lodging.

12. Track your expenses. Keep receipts of any additional expenses you may incur as a result of being forced to evacuate your home. Most policies provide coverage for additional out-of-pocket expenses as a result of a fire or other covered peril. Examples of such temporary expenses include:

• Hotel bills
• Laundry and dry-cleaning expenses
• Restaurant meals while you can't prepare meals at home
• Travel expenses.

13. Have the carrier pay you, directly. Some contractors will offer to do repairs for no money up front as long as you sign a contract authorizing them to bill your insurer directly. The practice may seem convenient, but usually doesn't benefit the consumer.

14. Consider effects on home-based business. Your business insurance may help you with lost inventory, equipment and lost income from business interruption.

If you are accumulating wealth quickly and live the comfortable life with a large house, luxury car and other expensive assets, you've no doubt already insured all of those belongings. But while most high-net-worth individuals have their possessions properly covered, they often overlook their largest risk: liability. In fact, they often over-insure against minor threats and underinsure for major ones. Many people will carry low minimums on their auto and homeowner's policies, which leaves them exposed to any liability lawsuits that may surface. If the maximum payout on your homeowner's or car insurance is less than the attachment point of your umbrella policy, you could be left having to cover the gap between the two. Look at it this way: If you wreck your Porsche it won't imperil you financially. But if you also maim or kill someone in the process of wrecking the car, your wealth could be put in jeopardy without the proper protection.

That's why it's of the utmost importance that you carry the proper liability coverage limits on your auto and homeowner's policies, so that you don't have a gap that can leave your personal assets and funds exposed. 
Further, if you are a public figure or sit on any boards of directors or do charity work, you may want to consider increasing your limits and supplementing your coverage with an umbrella insurance policy to insure against any lawsuits stemming from decisions you may make in those capacities.

Scenarios and repercussions
Umbrella shortfall
You're involved in a car accident that leaves the occupant of the other car in serious condition, and she will need extensive operations and likely years of physical therapy.
You've insured your car with a liability limit of $300,000 and you have an umbrella policy with a $1 million limit. That umbrella limit is not nearly enough to cover the bills for this injured individual, whose care costs will likely surpass $3 million easily in the next four years. That would leave you $2 million out of pocket.

Board liability
You sit on the board of a local non-profit and volunteer your time on the board without remuneration.
A former vendor sues the entire board for breach of contract after the board had voted to terminate their contract. The matter is brought to trial and a judge orders that all board members personally pay $100,000 each for their actions. If you don't have a personal umbrella policy, you'd be on the hook and out of pocket for the entire amount. 

Party foul
You have a Super Bowl party at your house and about 20 guests, one of whom slips on some spilled wine on your deck and throws out his back and can't work for three months. He sues you for negligence and the homeowner's insurer negotiates a settlement of $250,000. Your policy has a $100,000 liability limit, but your umbrella policy doesn't kick in until $300,000. That leaves you paying $150,000 out of pocket.

The takeaway
Unfortunately, if you have money, you might as well be walking around with a target on your back. In our litigious society one misstep or mistake can result in an expensive lawsuit and, if it goes to trial, the costs escalate tremendously and your fate rests in the hands of a jury or judge. Talk to us about a policy that would be right for you. Excess liability policies for high net-worth individuals will often include the costs of unlimited legal defense and legal counsel.

In 2017, the U.S. experienced one of the most disaster-filled years in history, with tens of thousands of people losing their homes and countless others temporarily displaced. The insurance industry is expecting the trend to continue, based on climate forecasts and the history of natural disasters and their costs over the past 10 years. The 2017 hurricane season was the costliest in the history of the U.S., resulting in countless windstorm and flood-damage claims from homeowners and businesses in affected parts of the country.
The number and size of tornadoes has also been on the upswing. The tornado season in 2017 started exceptionally early, having the second most-active January since records began in 1950, and one of the most active first quarters in recorded history. Then there were the wildfires that swept through large swaths of both Northern and Southern California, which made 2017 the costliest wildfire year in the state.

Despite this, a new survey by Clearsurance found that while nearly 90% of homeowners expressed heightened concern over potential damage to their homes from natural disasters, only 58% had taken steps to review their coverage to see if it was adequate. While you may think that your homeowner's policy will coverer you if a natural disaster strikes, you may not in fact be covered. If you live in or nearby an area that's been affected by a natural disaster in the last 10 years, you should talk to us about reviewing your coverage and risk picture.

Wildfire areas
Typically, standard homeowner's policies help protect against specific perils, or certain causes of loss, such as theft and fire, but coverage may vary by geographic location and by policy.
You may also find that some insurers do not sell homeowner's policies in areas where wildfires are common. However, you should check your policy limits and what it covers. If you bought the policy years ago and haven't revisited its details, you may want to schedule time to review it with us.

Tornado belts
If you are worried about damage and claims arising from tornadoes and spring storm conditions like hail, rain or windstorms, most standard home and car insurance has basic provisions for tornadoes (which are windstorms) and various weather-related types of risks.
But the type of coverage you have can make a difference of thousands of dollars in how much you get paid in a claim. The biggest risk you may face if your home suffers major damage during a severe storm or tornado is being underinsured.

Hurricane areas
The 2017 hurricane season was the costliest in the history of the U.S., resulting in countless windstorm and flood-damage claims from homeowners and businesses in affected parts of the country.
To limit their exposure to catastrophic losses from natural disasters, insurers in these states sell homeowner's insurance policies with percentage deductibles for storm damage. These are instead of the traditional dollar deductibles that are used for other types of losses, such as fire damage and theft.
With a policy that has a $500 standard deductible, for example, the policyholder must pay the first $500 of the claim out of pocket. But percentage deductibles are based on the home's insured value. If a house is insured for $300,000 and has a 5% deductible, the first $15,000 of a claim must be paid out of the policyholder's pocket. The details of hurricane deductibles are spelled out on the policy declarations page. 
While many people had windstorm coverage for their homes, about 70% of the flood damage caused by Hurricane Harvey was uninsured, according to CoreLogic, an aggregator of disaster risk data.

Flooding
Most states have some flood risk-prone areas and if you live in a designated floodplain, your mortgage lender will require that you carry flood insurance. Mostly, the main insurer for flood insurers is the National Flood Insurance Protection Program, although in some regions, a select few private insurers are in the market. But, just because you don't live in a floodplain doesn't mean you are 100% safe from flooding. You are at risk if you live near a river, regardless of the levee or weir protection system in place in your community, as weather and rainstorms are getting more unpredictable. Flood insurance protects two types of property: the structure of your home and the contents. Whenever you purchase a flood insurance policy, it takes 30 days for it to take effect. So, if you fear that your home will be inundated, be aware that you can't benefit from coverage purchased say just a week before such an event.

You've no doubt been overwhelmed by the amount of fine print that your insurance policy has.
The main reason for the fine print is to lay out in detail what the insurance company will cover in case of a claim and what it won't. It's important that you go through this with your insurance agent and that you especially understand the section called "Exclusions."

Exclusions
Exclusions are provisions in a policy describing losses that the policy will not cover. For example, a homeowner's policy does not cover losses caused by the use of cars, and a business auto policy does not cover injuries caused by a bulldozer on a construction site. While it may appear that the insurer includes these provisions to get out of paying claims, the reasons are more complex and less insidious than that. There are very sensible reasons why no insurance policy covers everything. First, not every person or business has the same exposures to loss. For example, you likely don't own a tractor as a homeowner and the owner of a tractor, in turn a company with 15 employees may work out of a building it occupies but does not own. Because there are so many contingencies, insurers try to create insurance policies that cover the average scenario for each policy. And they learn over time what they should cover and what they should not.

Getting specialty coverage
Standard insurance policies contain coverage that apply to large groups of households and businesses, but they do not cover every possibility. Policyholders with additional needs usually can purchase additional coverage in the form or a rider or endorsement. For example, homeowner's policies do not cover damage caused by water backing up from an overflowing sump or drain, but households that have basements with sumps or drains have the option of buying this coverage. If you don't have a basement or a sump pump, you obviously don't' need this coverage and it won't be forced on you in a typical homeowner's policy.
Every coverage comes with an associated cost and the insurance company must factor in the costs of potential claims, expenses and profit for that coverage.

The uninsurable
The more coverage a policy provides, the higher the premium. Without exclusions, people and businesses would be forced to pay for coverages they do not need. Exclusions help keep the premium affordable.
Also, some losses are just not insurable. That's because insurers cannot predict when certain types of losses will happen and how much they will cost. One typical exclusion is for acts of war or terrorism. Armed conflict with another country or full-scaled terrorist attack could cause huge losses beyond the abilities of insurance companies to pay. Because every household or business's circumstances are different, standard policies might not provide all the coverage necessary. For example if you live in a flood-plain, you should also purchase flood insurance along with your homeowner's coverage. And if you have specific liabilities or assets that may not be covered, you would likely need to talk to us about a policy endorsement.
​
If you think you may have specific insurance needs like this, don't hesitate to give us a call. 

If you've been insuring your vacation rental with a standard homeowner's policy, it likely won't be enough to cover the various types of damage that are inherent when renting out property, like a guest accidentally breaking that $3,000 65-inch flat screen while playing catch in the living room. And it also won't cover any injuries that your guests sustain on your property, or lost income should it be rendered un-rentable for a period. 

The answer is vacation rental property insurance, which you can think of like a homeowner's policy with some added protection for contents and liability. Even if you have a solid contract that requires guests to pay for damage to your rental and require a deposit, if someone doesn't have the money to pay for damage, you can try to sue but collection will be a long way off. In other words, if you don't have vacation rental insurance, you're on the hook.
 
What you need to know
A standard homeowner's insurance policy will not provide coverage for business activities. Also, policy language will vary from insurance company to insurance company and from state to state. So, it's wise to give us a call about your options. Usually, there are two alternatives:

• If the property is used mostly for short-term rentals of less than 30 days, then you may be able to purchase a special endorsement for your homeowner's policy from your insurer.
• If you're renting on a more frequent basis, you may need to purchase a separate business insurance policy for short-term vacation rentals.

The three main areas you'll want to insure are:
Liability - The biggest liability you'll face with a vacation rental is injury to your guests or damage to their property due to your alleged "negligence." Insurance would provide coverage for any injuries sustained by guests on your property that they blame you for, and for costs if they file suit against you.

Building and contents - If one of your guests starts a kitchen fire that burns half the property down, this part of a policy will cover rebuilding of the structure and replacement and installation costs of contents damaged or destroyed.

Rental income - If your property is damaged and rendered un-rentable for a period, a proper policy can also reimburse you for lost income during that time.

Before securing a policy
Before you decide on a policy, you should take stock of your rental:

• Do you provide recreational items like bikes, a swimming pool or row boat? This increases your chances of a liability claim.
• What are the conditions around the property? Is the area prone to wildfires or other natural disasters?
• Hire an inspector to check the condition of piping and wiring to bird-dog any signs of wear that could lead to a leak or fire.

 
If you also stay in your rental
If you insure your short-term rental as a business, you can also stay there since there are no standard occupancy restrictions on a business policy. This means the property is insured while you, your friends or family, and of course paying guests stay there. If the short-term rental is also your primary residence, you can still purchase a vacation rental policy. In that case, the policy simply adds $1,000,000 in personal liability and $50,000 in loss of use to relocate in the event the property is being rebuilt. This is very important if you don't carry a homeowner's policy elsewhere.