Buying a home is a huge investment and any intelligent person would want to protect that investment. That is what homeowners insurance is for, to safegaurd what will likely be the largest investment you will ever make. You might be asking yourself, how does homeowners insurance work? Homeowners insurance provides coverage in the following three areas. The structure of your house, your personal property in and around your house, and liability. Let's discuss each of these a bit further. The first major area of coverage that we will discuss is the actual structure of your house. Many policies cover up to 80% of the value of the home. The thinking behind this type of coverage is that if the house is damaged it may not be completely destroyed and therefore 100% of the value would not be required to make the repairs. Other policies cover 100% of the value which is good to have in the event of a fire where a house burns completely to the ground. The next major area of coverage is for all of your personal property which is not a structural part of the house. Things like furniture, electronics, appliances, etc. Many policies provide coverage for the cash value of your personal possessions. With this type of coverage you have to take into account any depreciation of your possessions. For example, if you paid $8,000 for a plasma television five years ago and it was destroyed, your insurance policy is not going to pay you $8,000 to replace your television. A 5 year old plasma television may only be worth $2000 or $3000. However, there are also policies available that will pay to replace damaged personal property with a brand-new item of equal value. The next major area of coverage would be liability coverage. If someone is visiting your house and sustains an injury and then decides to file a lawsuit against you, your homeowners insurance would protect you in this situation up to a predetermined dollar amount stipulated in your policy. Many insurance companies will provide liability coverage up to $100,000. Of course if you need more coverage you can always get more coverage but you will have to pay more for it. Each of these major areas of coverage have lots of little details and variables which affect not only the amount of coverage you have but also the amount you'll have to pay in premiums. When shopping around for homeowners insurance there are several ways to make sure you get the best possible price. As with any large financial commitment it is important to educate yourself as much as possible before making a decision.
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Learn the facts about homeowners insurance. Visit http://www.homeowners-insurance-questions.info - Lots of information and tips on how to save money on homeowners insurance.
Tue, 15 Jul 2008 07:03:42 - 100%
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