You ask, I answer.

What questions should I ask my agent about my current homeowners insurance?

Homeowners insurance is a necessity for every homeowner. It protects you from damages to your home or personal belongings should the unthinkable happen, such as a fire, theft, or natural disaster. If something happens at your house and you don’t have the proper coverage, it could be devastating.

When reviewing your homeowners insurance with your current agent or company, use the following questions to ensure your home is properly covered:

Q: Does my policy have guaranteed replacement value of my home and contents?

Guaranteed replacement cost ensures that if your home needs to be rebuilt from scratch, there is enough coverage to totally rebuild.  Guaranteed replacement cost on contents means if your things inside the house need to be replaced, you get full value to replace those items, not just the depreciated value.

Q: Is water back-up or water damage from a sump pump failure covered?

Water usually flows down drains, but when a problem out in the water main occurs and causes water the flow up from toilets, shower drains or sinks, you have a problem, especially if this coverage isn’t added to your policy.  If the power goes out or your sump pump fails, any water damage from that sump failure isn’t covered, if this coverage isn’t specifically endorsed.

Are my appliances (fridge, washer/dryer, dishwasher, electric stove, HVAC system, computers, etc.) covered if damaged in a power surge?

Equipment break-down, unless specifically endorsed, is not covered on your standard policy.  This will cover items that have electronic circuit boards that are connected to your home and get damaged because of the power surge.  Depending on the company, coverage may also apply to your phones and tablets that are plugged in and charging.

Are the underground utility lines (sewer/water) that run under my front lawn covered if damaged and have to be dug up and replaced?

The underground lines that connect your home to mains out under the street, are your responsibility.  These lines are usually water and sewer pipes buried underneath your front lawn.  If these pipes break or get damaged, you would be responsible for any repairs or replacement that the water company provides.  This coverage is available from both your water company as well as your homeowner’s insurance company and is usually much cheaper to add onto your home insurance.

How much liability protection do I have?

Liability on your homeowners insurance should include both premises and personal liability protection.  We recommend this starts at $500k.

What are my deductibles?

Your deductibles are the portion of the damage you are responsible to pay.  Some policies have one flat amount for any covered peril, might be $500-$1000.  Some policies have separate deductibles depending on what caused the damage, i.e. wind, hail, hurricane, etc.  In some cases, you may have a 5% hurricane deductible, which means, your deductible would be 5% of your dwelling coverage.  Your home is insured for $400k, 5% of $400k is $20,000.  Any damage resulting from a named hurricane, you would be responsible for the first $20k of damage.  Always make sure you are aware how your deductibles work.

How much am I paying?

“What is this costing me?”  If you have a mortgage, you may be paying your insurance as part of your monthly mortgage payment, which makes an overpriced insurance policy more difficult to spot.  Saving money on your insurance means a lower monthly mortgage payment.  Know your options.

If you haven’t reviewed your policy lately or if you weren’t familiar with any of these questions and answers, I’d be happy to help.  Insurance should never fall under the category of “Set it & Forget It”.

– Frank Zahn, CIC

[email protected] • 732.566.0003