Your mortgage company is only concerned with protecting their asset. If your home is worth $300,00, you only owe $50,000 to the mortgage company, your mortgage company will only require you to purchase $50,000 in insurance coverage. $50,000 in insurance is lot less expensive than $300,000, but what if you have a total loss? You will only receive a check for $50,000 and it will go directly to the bank—you will receive nothing.
Cash Value over replacement cost
When you experience a loss, Actual Cash Value only provides reimbursement for the “book value” of the item. In some cases, an old sofa, table, or computer is worth next to nothing so you would receive next to nothing. If you select “Replacement Cost,” you will be given a brand new replacement of that item without any deduction for depreciation.
Bring Down Premium Costs
Insureds frequently make the mistake of reducing the amount of coverage in an attempt to bring down the premium. A better approach would be to carry strong coverage and raise the deductible. You will have a lower premium and KEEP stronger coverage. In the event of a large loss, the insured will only pay “out of pocket” a deductible of 1K or 2.5K—instead of being out 175K to replace all the contents of your home.
If you are renting out your home and those occupying the home experience a loss to THEIR personal property, YOUR “landlord” policy does not cover the loss. Tenants need to have their own renter’s policy to cover their personal property and liability.
Call the professionals at Doyle Insurance
Insurance can be complicated. Agents are required by their state to be licensed and sustain continuous learning in all aspects of insurance. An agent can communicate the important details and help you make informed decisions. Agents are also able to compare price and coverage across many companies. If you act on your own, without an agent, and you make a mistake, there is little an agent can do to protect you. Finally, agents sell many types of insurance policies. One stop-shopping saves you time and money. At Doyle Insurance we pride ourselves in providing the best protection for your unique circumstances. If you are contemplating a change or simply need to make sure you have the appropriate coverage, give our office a call. We will be happy to help you!