November 2, 2022
insurance for contents

The Importance of Home and Contents insurance as a homeowner.

Home and contents insurance generally refers to coverage for property you own. For example, your treasured belongings, your priceless valuables or whatever is valuable to you. With personal property protection, you're basically covering the personal possessions that you keep in your home.

Why should you insure your personal possessions? If you live in a rental home or an apartment and disaster strikes, your landlord is already covered for structural damages. But, what recourse do you have if everything in your rental is destroyed or severely damaged? The insurance policy that your landlord has on his or her property won't cover these things. As a tenant, it's your responsibility to take out an insurance policy that will reimburse you for what you own if it were to suddenly go up in smoke or suffer severe damage as a result of a storm. Home and contents insurance also protects you against theft. It is a smart investment you should strongly consider to protect your belongings.

Use a Home Insurance Broker

Choosing the right policy and the right insurance company involves many factors, including what you have to insure, where you live and what insurance company options you have. If you choose the right policy, your assets will be completely protected from loss and you will be compensated quickly in the event of calamity.

Before writing your policy, you should estimate the value of your belongings. If you combine contents insurance with a house policy, the content's portion is often valued at a percentage of the house value. Anything but a detailed valuation of your assets may leave you underinsured or paying premiums that are too high.

That doesn't mean that you have to take every drinking glass and side table to an appraiser. You should, however, list out your assets and give them a reasonable value - both what you think they are worth now and what it would cost to replace them. Taking inventory with a video camera, giving a brief description of the your most valuable items is helpful.

home and contents insurance

You also need to consider what type of coverage you need – Actual Cash Value or Replacement Cost coverage as when you buy home contents insurance, you may have the option to select one or the other. In the event of a claim, Actual Cash Value coverage factors in depreciation and pays what you'd expect to receive for your belongings if you sold them today. Replacement Cost coverage pays the cost to replace your item with one of the same kind. For example, you might have paid $1,000 for your TV 10 years ago, but if it gets destroyed as a result of a covered disaster, you'll be reimbursed for whatever it costs you to find a matching replacement.

If you had Actual Cash Value coverage, you would only be paid what your TV is worth today, which may not be much. Most of the time, Replacement Cost coverage comes with higher premiums, but you may find it to be well worth it.

What Does Home Insurance Cover?

Regardless of the contents policy, you settle on, it will not cover every loss situation or every asset. You should read the details of the policy before settling; don't just rely on what the agent tells you. All that matters is what is in the contract. You don't want to find out when you make a claim that you are not covered for your situation. Common exclusions include floods and named storms, contents not belonging to the dwelling owner, antiques and collectibles, and damage caused by lack of proper maintenance. Some companies will insure some of these specific risks, so, if they are important to you, you may need to obtain separate coverage.

If you own any precious jewelry, expensive electronics, rare coin collections or anything of high value, you may have the option to increase the amount of coverage so that you're adequately reimbursed if they're lost, stolen or destroyed. You can choose to get increased coverage for individual items, or you can choose to boost your level of coverage for groups of items. It all depends on what fits your needs.

There are many options when it comes to buying contents insurance. Understanding the coverage you need and obtaining a Home Contents Insurance quote HERE or call: 800-459-6060.

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John Espenschied is a long-time veteran of the insurance industry. He's worked with thousands of clients over the years, helping to protect their personal and business needs. John's goal is to provide the best advice possible to assist customers in saving money while protecting their property and securing their financial future.
He truly enjoys helping others and takes great satisfaction in providing top-notch customer service. When he's not working, John has fun spending time with his family, golfing, bike riding, and blogging on insurance topics.