What Coverage Should You Look for when Shopping for Homeowners Insurance in Tuscany Village, NV?

When buying or owning a home, you must have homeowner’s insurance. All mortgage or lender companies will require every home to have some kind or protection policy. Even though you are required to have homeowner’s insurance, that doesn’t mean you are stuck with a single type of policy. There is a general homeowner’s insurance policy, and then there are add-on policies that provide more coverage. When shopping for a homeowner’s insurance policy, there are certain basics you need to understand. InsureWise would like to share what you need to know to get you started on your search for the perfect homeowner’s insurance policy.

What is Homeowner’s Insurance & How Does it Work?

There are a few different things a basic homeowner’s insurance policy plan will cover. First, a basic homeowner’s insurance policy will cover the cost of damages or destruction that might occur to the home either inside or on the outside. Another part of a basic homeowner’s insurance policy is the loss of possessions within the home due to damages or theft. Lastly, homeowner’s insurance also covers personal liability for others that may have been harmed within the home. Along with a basic coverage, a homeowner’s insurance will have different levels of coverage. There are three major levels of a homeowner’s insurance policy, which are actual cash value, cost of replacement, and extended replacement of cost and value. Additionally, the rates of the homeowner’s insurance policy will vary and are determined often by the insurer’s risk of filing a claim. Insurance providers will often assess the risk based on claim history and the home’s location.

Defining the Levels of Homeowner’s Insurance

In the United States there are different forms of homeowner’s insurance that has become standardized and are designated as HO-1 through HO-8. Each level offers more or less coverage in certain areas of the home. When going over policies, take your time and look at each policy and its level of coverage. As previously mentioned, there are three major levels of coverage. There are actual cash value, replacement cost, and extended replacement cost and or value. When looking for a homeowner’s insurance policy is that right for you, it is good to know the different levels of coverage and what they mean.
• Actual Cash Value – Coverage of the cost of the home’s current value and all of the possessions or belongings after deduction or depreciation. Depreciation is how much the items are currently worth and not how much they cost you at the time of purchase.
• Replacement Cost – Coverage of the home and your possessions but without deduction or depreciation. So, the value of both home and possessions at the time of purchase will be the amount your receive back. For example, if your home caught fire and needs to be rebuilt, the home will be rebuilt to match its original value. Sometimes an insurance provider will try to save money and rebuild the home using materials of lesser value. Replacement cost ensures your home is be repaired or rebuilt to match its value. The same can be said for the replacement of personal possessions.
• Guaranteed or Extended Replacement Cost/Value – This policy is similar to the Replacement Cost coverage but will also cover additional cost due to inflation.

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It is important to make sure to get the coverage you want. For more information or help getting the right homeowner’s insurance policy, contact InsureWise today.

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