Many times people begin shopping for homeowners insurance without a plan. They pick up the phone, call a few companies and simply ask for a home insurance quote. At Chrinco, we believe in equipping insurance shoppers so they not only know what coverages to ask for but also how much coverage to request.
Homeowners insurance is a fairly complex policy. With its many available coverages such as personal property, detached structures and loss-of-use coupled with its add-on coverages such as replacement cost versus actual cash value, it’s easy to lose your way in the myriad of choices and make your decision based solely upon price.
Homeowners insurance is not just about price. I have often said that homeowners insurance is all the same….until you have a claim. It’s when a claim is filed that most people find out what they’ve been paying for. At Chrinco, we strive to educate insurance consumers so they know what they’re buying before they stroke a check.
The next time you’re shopping for a home insurance quote there is one thing you must do before picking up the phone or filling in an online form. You must determine the replacement cost of your home. Not the market value; the cost to rebuild.
There are some serious repercussions for being underinsured when a loss occurs. Namely, your loss will not be fully covered even if it’s a partial loss. And while most insurance companies have safeguards to ensure you’re adequately covered at all times, there are some insurance companies out there that will allow your coverages to remain below desired levels.
Additionally, many of the ancillary coverages within a homeowners insurance policy are determined as a percentage of the replacement cost. Short change yourself in dwelling coverage and you will be short-changing yourself on other coverages as well.
The next time you looking to shop for homeowners insurance, remember to research the replacement cost of your home before looking for quotes. You will be a more informed consumer and will make a better buying decision as a result.
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