Home insurance is the basic insurance that covers your home in case of fire, theft, water damage (different than flood damage), frozen pipes and other damages caused by ice and snow. Home contents insurance gives you even greater protection for personal items of “high value or worth” in your home.
Home contents insurance policies tend to be very comprehensive, so they will cover more or less everything you own. Many people who purchase home contents insurance policies cover such items as home theater and stereo equipment, antiques and artifacts, works of art, dining materials, sofas and any other items of personal value. You can even purchase this insurance that covers your frozen food in the event the freezer defrosts everything.
Contents insurance is designed to protect all your belongings against loss or damage while in the home. Your personal belongings may be damaged as a result of theft, fire or flooding.
Always make sure you know the stipulations of your home contents insurance policy. You want to know your belongings will be covered in case of fire, theft, flooding, etc.
There are a couple of ways contents insurance works. The first is a replacement cost coverage plan. This home contents insurance pays the exact dollar amount needed to replace damaged, personal property with items of a like kind or quality without depreciation of value. The second is an actual cash value. Actual cash value home contents insurance gives you an amount equal to the replacement value of damaged property minus depreciation.
Here are a few tips to help you as you purchase contents insurance.
• Know the limits on your personal property such as jewelry, furs and computer equipment. If the limits are too low, consider buying an “endorsement” or “floater.” An endorsement is an addition to your insurance policy. A floater is a form of insurance that allows you to insure valuable items separately.
• Make an inventory of everything you own in your home. Write down all items under your insurance policy and keep track of items added to the insurance policy. You may want to write down the serial numbers, prices, item numbers, date of purchases and so forth. This will give an accurate and detailed record to an insurance agent in case of emergency.
• Take either still or video pictures of everything that is covered under the home contents insurance policy. Attach receipts to items where possible. You want to make sure you store the inventory and picture records someplace other than home. A safety deposit box is a good suggestion.
Insurance agencies will recommend you purchase contents insurance protecting your belongings from accidental damage caused by yourself. Inevitably, all items are prone to some form of accidental damage no matter how careful you may be. Computers, stereos, televisions, other electronic equipment and glassware tend to be the most prone to accidental damage. Sometimes these are the most valuable items in a house.
By shopping around you should be able to find a home contents insurance policy that suits your needs.
By John Ivie