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Buying a home is one of the most important decisions and significant investment most people will ever make. To protect this investment, homeowners need insurance. Depending on the location of your property, you may need more than one type of insurance. Here are five insurance policies that homeowners should consider to protect their home.
1. Homeowner’s Insurance
Homeowner’s insurance is compulsory for homeowners with mortgages. A typical homeowner’s insurance policy will cover:
2. Flood Insurance
Homeowners insurance usually does not cover flood damage, including flooding resulting from hurricanes, torrential downpours and other natural events. Many homeowners falsely believe they don’t need flood insurance because they don’t live in a high-risk area, but the widespread flooding that resulted from Hurricane Harvey in the Houston metropolitan area showed that intense storms could damage homes, not in a designated floodplain. Enter your address in the FEMA Floor Map to help make your decision,
Homeowners can purchase a National Flood Insurance Program policy that protects their home up to $250,000 in damages and personal property up to $100,000 in damages, or you can elect to protect either home or personal property.
3. Earthquake Insurance
Earthquake insurance is a form of property insurance that pays the policyholder in the event of an earthquake that causes damage to the property. Some insurance companies consider earthquake insurance an add-on to a standard homeowner’s policy while others may make you purchase as a stand-alone insurance.
This U.S. Geological Survey map shows that western states are more prone to earthquakes, whereas eastern states have a relatively lower risk.
4. Umbrella Coverage
Umbrella coverage provides additional liability coverage above the limits set by your homeowner’s insurance policy. It is designed to help protect the homeowner from major claims and lawsuits, and as a result, it helps protect your assets and your future. It does this in two ways:
5. Valuable Items Coverage
This insurance policy supplements your standard homeowner’s policy by providing higher limits to cover your more valuable items including jewelry, cameras, computers, golf equipment, fine art or antiques, should they be stolen or damaged.
No matter what hand the weather or life deals, homeowners should be financially prepared to handle any situation. Insuring your home and possessions sufficiently to be repaired or replaced can help provide this peace-of-mind.
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