With Spring just around the corner, we’re looking forward to sunshine, warm breezes, blooming flowers and of course Spring cleaning! And while everyone is getting ready to clear out the garage or organize that disheveled storage room, now is also a great time to review your homeowners insurance policy for any changes or additions you may need. Think about what has happened in the past year; have you added a new pet to your family, acquired expensive equipment, or installed a new alarm system? Changes like this will affect your insurance coverages.
You can clean and organize your home until it’s spotless, but your insurance policy is what will protect your newly-tidied things in the event of a claim. At KW Insurance, we are happy to offer a free insurance review to see if there are any additional coverages that you may need. Sometimes, you can add coverage by purchasing endorsements; other times, you must buy a separate policy. Our trusted professionals will walk you through the steps and help you determine the right coverages for you. Check out these additional coverage options as you review your homeowners policy:
Replacement Cost Dwelling Coverage:
Increases the cost to rebuild your home due to a covered loss on your homeowners policy. Typically, your coverage is increased by about 150% of Coverage A. For example, let’s say you have a $300,000 limit on Coverage A. If you add Replacement Cost Dwelling to that policy, it would extend the coverage up to $450,000.
Personal Property Replacement Cost Coverage:
This coverage increases the amount on Coverage C, the cost to replace damaged personal property with that of the same kind and quality. Typically, property will be replaced with an Actual Cash Value. However, most the time, the actual cash value is significantly less than it would cost to replace the item due to depreciation.
Scheduled Personal Property Coverage:
Protects valuables like jewelry or fine arts. This extends coverage of these items beyond their category limits so that the item can be replaced in full or you can receive cash value to purchase an item of equal value. Scheduled Personal Property Coverage will also protect against a larger variety of perils such as mysterious disappearance. For example, when the diamond falls out of its setting and you don’t realize it until it’s long gone—that’s when Scheduled Personal Property Coverage would be handy.
Check out our full Scheduled Personal Property Coverage blog for more details on this coverage.
Inflation Guard Endorsement:
Automatically adjusts your dwelling limit by a certain percent (usually 4% or 6%) to reflect current construction costs where you live. Let’s say your home is insured for $100,000 and you choose a four percent increase rate. If you suffer a complete loss in 6 months, your insurance will pay $102,000; if the loss occurs 9 months later, then the payment will be for $103,000. It’s a good idea to work with one of KW Insurance’s trusted agents to continually update your coverage so it holds up to the changing cost of construction materials.
Ordinance or Law Coverage:
Pays for the extra expenses to rebuild your home in compliance with new building codes and other ordinances that didn’t exist when your home was originally built. This will cover necessary upgrades for electrical, plumbing, or similar systems. In many communities, there are building ordinances requiring that a building with a certain amount of damage (usually 50% damage) must be demolished and rebuilt in accordance with current building codes instead of simply being repaired. So if your home was built around the 1930s, it is likely that if you have a total loss, your home will be rebuilt with an updated heating system or improved electrical wiring.
Home Business Coverage:
This endorsement increases the coverage on business property in the home from $2,500 to the limits of Coverage C on your homeowners policy. It includes coverage for accounts receivable, records, and lost income and extra expenses when the business must be suspended due to a covered loss. Coverage for business property located outside of the home is increased from $500 to $5,000. For those who operate a business out of their home, this endorsement adds an extra level of protection.
Identity Fraud Expense Coverage:
Provides reimbursement for certain expenses for victims of identity fraud. In addition, it offers personal assistance through the Identity Fraud Crisis Resolution Center. Policyholder victims may be assigned a counselor advocate throughout the identity restoration process.
Special Computer Coverage:
Provides coverage for personal computers, equipment, media, and data on a special risk basis.
Water Back-up and Sump Pump Overflow Coverage:
Provides coverage for water that backs up through sewers or drains (including waste water), only if it originates on premises. Water damage is not typically covered in most homeowners policies. Adding this coverage is a great idea for any home with a basement, or if the home has older water infrastructure—older pipes have a higher risk of bursting. Water Back-up and Sump Pump Overflow Coverage will also cover water that escapes, overflows or discharges from a sump pump or any other system designed to remove water which is drained from the foundation area.
Flood Insurance Coverage:
Provides coverage for damage caused by water due to flooding. Flooding is one of the most common disasters that can occur in Massachusetts. As cities and towns are becoming more developed, there is less soil in which water can be absorbed; this leads to an increase in flooding. Most homeowners policies do not cover damage caused by flooding, and with the unpredictable weather lately, it may be a good time to look into this coverage. Floods can happen anytime of the year and are more common when you least expect it.