As an investor in residential property, you need to have a clear and complete understanding of your standard homeowners insurance policy. It generally covers disasters, accidents, and theft, but you should talk with your insurance agent to be more certain. Standard coverage is categorically for home structure, personal belongings, liability, and additional living expenses (ALE). Here are the limits of standard homeowners insurance.
Coverage for Structural Damage
The most fundamental aspect of your standard homeowners insurance policy is that it will cover costs to repair or rebuild your home if it gets destroyed in a natural disaster. Hurricanes, tornadoes, and lightning can cause excessive damage in some regions. Ensure that you know all the different types of potential disasters your policy covers, since the standard plan doesn’t cover an earthquake or flooding.
Protecting Value of Personal Items
The standard plan covers various personal items such as equipment, furniture, and clothes if your house burns down or suffers certain other disasters. This coverage represents up to 70 percent of structural insurance. It helps to make a list of all your valuable belongings and report them to the insurance company. Jewelry and credit cards can also be covered in the event of damage or theft.
Liability Coverage
If a guest gets injured on your property, you’ll be covered by your standard plan’s liability segment. It further protects you from lawsuits relating to damaging someone else’s personal belongings on their property. Accidentally spilling a substance on the person’s valuable rug, for example, will be covered by liability. Standard homeowners insurance coverage is usually limited up to $100,000.
ALE Coverage
The ALE part of your standard homeowners insurance plan covers living expenses if you cannot reside in your home. Coverage includes hotel and restaurant bills, usually for a limited time while your home undergoes repair. It also covers lost revenue if you rented the place to tenants. Be aware this coverage is separate from rebuilding costs.
The key to the right amount of coverage for any homeowner is the amount you need to build your home. Check your standard homeowners insurance policy to make sure it covers everything you expect, including structure, personal belongings, liability, and ALE. Contact the experts at Steve Wilk Insurance today to learn more about various insurance coverage. Our office is located at 310 S Main Street, Suite C, Lombard, IL 60148.
