When it comes to making sure that your home and family are safe and sound, few things are as important as choosing the right insurance plan. About six months ago, my home burned to the ground, and without the right insurance plan, we would have been toast financially. Fortunately, because we had prepared properly, we didn't have any problems when it came to making sure that we could rebuild our place. This website is here to help anyone who might be struggling with which insurance policy to choose. Check out this blog for great information on finding the perfect policy.
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Many Americans are living on tight monthly budgets. Finding ways to reduce fixed costs can be a simple way to free up additional spending money each month, and many homeowners look to their homeowners insurance policies when making budget cuts. While you may be tempted to cut back on your coverage, there are some places that you simply shouldn't scrimp if you want to ensure your home is properly protected in the future.
Here are three areas of your homeowners insurance policy that you should leave intact the next time you are making household budget cuts.
1. Leave your limits alone.
It's important that your homeowners insurance policy has a limit high enough to allow you to rebuild in the event something happens to your home and it is a total loss. Lower limits often mean a lower monthly premium, but if you face a fire, flood, or tornado you could regret cutting your limits.
The only time you should change your policy's limits is when you increase the limit to reflect your home's new value once a home improvement project is completed.
2. Maintain loss-of-use coverage.
If your home becomes uninhabitable due to some disaster, you will need a place to stay while the necessary repairs (or a complete rebuild) take place. If your monthly budget is already tight, you may not have the additional money needed to pay for a hotel or rent an apartment in addition to paying your monthly mortgage.
By maintaining loss-of-use coverage through your homeowners insurance policy, your insurance company will reimburse you for these expenses. In the long run, it makes sense to spend a little extra on your policy premium each month to ensure that you will have access to the money you need to pay for your living costs should your home become uninhabitable in the future.
3. Retain necessary endorsements.
Endorsements are specialized types of coverage that you can add to a generic homeowners insurance policy. Adding endorsements to your coverage can increase monthly premiums, but it can also ensure your home is fully protected. You need to take environmental concerns into account when determining which endorsements you want to retain.
If you live in an area where flooding, earthquakes, or tornadoes occur frequently, then you need to retain the endorsements that protect against these natural disasters to prevent serious financial hardship if your home is affected by a natural disaster in the future.
When you understand the aspects of your homeowners insurance policy that are vital to protecting your home, you will be able to determine which parts of your policy you shouldn't scrimp on when trying to reduce your monthly premium rate.
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