3 Insurance Questions Every Homebuyer Should Ask

Before buying a new Greensboro homeowners insurance policy, it's important that, as an educated consumer, you understand the right type and amount of coverage you need. You should be familiar with what a basic Greensboro homeowners insurance policy covers as well as what it doesn't cover. This can best be accomplished by getting together with your trusted insurance agent or broker and carefully reading through the coverage he or she recommends you consider carrying.

A basic Greensboro homeowners insurance policy will contain a minimum of three types of protection. These include:

A. Coverage for losses relating to your dwelling

B. Coverage for losses relating to your personal property/possessions

C. Coverage against liability

Many homeowner's policies also include coverage to pay for additional living expenses if a covered peril prevents you from living in your home for a period of time. Here are some questions you may want to consider while determining what level of protection suits you best:

1. How much would it cost to completely rebuild my home after a total loss? The amount of homeowner's coverage required by your mortgage holder is probably just enough to cover their financial exposure in the event your home is destroyed. This amount, however, may not be enough to rebuild your home in its current location to the same quality level as before your loss. Make sure your insurance coverage amount is enough to rebuild your home to current standards at current costs.
2. What's the value of my personal property? Your personal property (such as clothing, furniture, appliances, electronics, etc.) is protected against a covered loss up to the limits of your policy. Typical homeowner's policies allow benefits in the amount of 50%-70% of the coverage on your home's structure. There are also often specific limits on things like jewelry, artwork, valuable antiques, valuable collections, etc. If your possessions are valued in excess of the limits of your policy, you'll probably want to pay extra premium to obtain limits more realistic to your needs.
3. What level of liability coverage should I have? Liability coverage protects you from losses from lawsuits when accused of being responsible for bodily injury or damage to others. Typical policies limit liability payments at around $100,000, which experts agree is a low amount. Many recommend $300,000 or even more if you have a swimming pool, trampoline, aggressive dog or other high-risk scenarios. For high liability, consider an umbrella policy.