Here are some of the figures relevant to your home insurance and why they matter.
As a homeowner, it’s important that you have the right insurance coverage to meet your home’s needs. Part of making sure you have the right coverage is understanding the different figures relevant to your policy. If you want to make sure that you have the right coverage, here are some of the important figures that you need to understand.
Replacement Cost Value
Replacement cost value is the amount of insurance coverage you have for your home. This value is based on how much it would cost to rebuild your home if it was completely destroyed. For instance, replacement cost value takes into account the cost of labor, building materials, and bringing your home up to code. It’s incredibly important that you correctly estimate your home’s replacement cost value, as it represents the maximum amount that your insurer will cover you for. If you estimate this value too low, you will be financially responsible for any claims that exceed your policy limits.
Value of Your Belongings
Your homeowners insurance will also provide coverage for your personal belongings. Generally, a standard homeowners policy will cover up to half of the value of your possessions. The best way to determine the replacement value of your belongings is by creating a detailed home inventory. Once you know much your possessions are worth, you can determine whether your policy is offering adequate coverage for your needs.
Home Insurance Deductible
Your deductible is the amount of money you agree to pay towards repairs before your insurance coverage kicks in. For instance, if you set a deductible of $500 and your home was damaged, then you would have to pay $500 for repairs before you could access your insurance coverage. Your deductible and premium have an inverse relationship, meaning that the higher your deductible, the lower your premiums will be. However, it’s important that you do not set your deductible too high, as this might prevent you from accessing your insurance coverage when you need it the most.
These are some of the values and figures that are important to your home insurance. Do you have more questions regarding your homeowners insurance? Turn to the experts at VGW Walker Insurance in Texas. Our dedicated team is ready to assist you with all your coverage needs. Contact us to get started today.
