Home prices have been going up consistently for a couple of years. The supply chain issues caused by the pandemic, inflation, and labor shortages have only pushed prices further north. If you’re a homeowner, you know what this means. If your home gets damaged in a natural disaster or if it’s destroyed in a fire, you could lose a ton of your money fixing it if you don’t have the right level of insurance coverage. Here are a few tips that will help.
Protect Against Cost Spikes
Ensure that your home insurance policy has dwelling coverage. This will pay to fully or partially repair or rebuild your home in case it gets damaged by something covered under the policy. Work out the coverage amount based on how much it would cost to rebuild your home completely. Remember to factor in the cost of local construction and labor. Some insurance policies also have extended or guaranteed replacement costs that absorb a spike in construction costs when needed.
Water Damage
Floods are one of the most common natural disasters, and many homes are at risk. Not having flood insurance can prove extremely expensive. You can either get covered under the National Flood Insurance Program or get a policy through a private market.
If you live in an area that is often affected by storms, you should fortify your home against hurricanes. This will reduce damage from wind-driven rain and reduce roof leaks.
Floods aren’t the only source of water damage. If possible, install a water-leak detector that alerts you on your smartphone if there’s a leak or if a frozen pipe is about to burst. A detector can help reduce claims and get you a discount on your premium. You can also add coverage for sump pump failure and sewer backup.
Windstorm Coverage
Homes in coastal areas may also need a windstorm policy in addition to any other coverage they may have. If your property is in a seismically active region, you may also want to consider earthquake insurance.
Don’t Overlook Liability
This coverage pays for legal defense, judgments, and settlements in case you get sued over injuries or property damage. Ensure your coverage covers your assets or consider an umbrella insurance policy.