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It's ironic that a document of such great importance to homeowners is
one that they often don't consider until disaster strikes.
Unfortunately, that's precisely the time when they discover that
they're not covered for the things they desperately need when nature
rears its sometimes ugly head or when a simple case of bad luck
strikes. As we've mentioned before in
previous articles, flood insurance is typically not included in your
homeowner's insurance policy. We're in the middle of flood season, and
those of us who swore it couldn't happen to us could very well find
ourselves in such a situation. What if a frozen pipe bursts in your
home? Everyone is vulnerable.
You know that you purchased insurance ages ago when you bought your
home, but you haven't reviewed the document in years. Perhaps better
coverage was out of your financial means back then, but it's within
your means now. Or, as is the case within many households, one spouse
may have taken the initiative for purchasing homeowner's insurance.
The other spouse assumes all has been taken care of and never asks to
review the terms of the policy. Regardless of the scenario in your
household, it's a good idea to take inventory of your homeowner's
insurance policy periodically and assess whether or not you and your
family need additional coverage in key areas.
On the other hand, your homeowner's insurance policy may cover some
items about which you're not even aware. The following items typically
are covered under homeowner's insurance policies. However, it's
important to emphasize that you can't take this list for granted. By
all means, take a close look at your own policy and find out precisely
for what you're
covered. Keep in mind that the items listed here can vary according to
the terms of your specific policy, as well as the dollar amount you
purchased.
Your home in general, which includes any extensions or
attachments to your house, such as a garage. Policies usually will
include coverage for any rental units that are considered part of your
home.
The "outdoors" around your home, meaning your lawn and
landscaping (shrubs, flower beds and trees).
Buildings or structures that sit on your property but are not
attached to your home. This includes greenhouses, tool sheds, garages
that are not connected to the house, pool houses/cabanas, guest houses
and gazebos.
Any vacant land that you either own or rent. Most policies,
however, exclude farmland under this definition.
All living expenses incurred by you and your family if your
home is damaged to the extent that you cannot reside there for the
immediate future. In addition, if you rent part of your home out to
tenants and that portion of your home is unlivable due to damage, your
rental payments are covered under your insurance policy.
Possessions belonging to you and your family. This includes
the personal contents of your home and any additional
buildings/structures on your property, as well as the possessions
belonging to guests who were staying in your home when disaster
struck. Note, however, that most insurance policies will not cover the
possessions of any tenants who were residing in your home at the time
of the disaster.
Possessions belonging to friends that you may have been
borrowing or keeping in your home temporarily (for example, storing a
gift for friend who didn't want a spouse or child to see the surprise
before presenting it to him/her).
Cemetery plots.
In the event that, at the time of disaster, you were facing
attorney's fees and court expenses, medical bills or settlements
resulting from claims brought against you for property damage or
bodily injury to others, those costs often are covered.
Legal responsibility for any checks forged with your name, the
unauthorized use of your credit cards or any counterfeit currency that
was accepted in good faith.
Because homeowner's insurance policies, like any other official
document, often contain somewhat confusing language, write down any
questions you have as you look through your policy, and ask your
insurance representative
for a full explanation. If your financial standing has improved since
you took out your policy, find out what the next level of coverage is,
its cost and whether or not you and your family could benefit from the
additional protection. Various regions of the country, of course, are
vulnerable to certain weather conditions (hurricanes and tornadoes,
for example), as well
as natural forces (earthquakes). Ask friends and relatives --
particularly those residing in the same city -- what type of coverage
they have chosen and if they're satisfied. As a homeowner, you
regularly inspect your appliances and conduct tune-ups as needed. You
should approach your homeowner's insurance policy in the same manner.
It could prove to be one of the most valuable possessions you own.
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