Are you buying a new home, townhouse or condominium? Are you moving into your first apartment or condominium? Whether you’re buying or renting, having insurance is critical.
First we’ll take a look at why Homeowner’s Insurance and Condominium Insurance are beneficial. Once you buy a home, it’s yours. If a storm blows out a window, insurance will cover the cost to replace it. If pipes burst and your home sustains water damage, insurance will cover you. If you are robbed, you are covered. Damage to structures on the property are covered. Fire loss is covered. A few things not covered on most Homeowners Insurance Policies or HOIs are earthquake, hurricane and flood coverage. In areas that experience high rates of any one of these natural disasters, these policies are often extra. Homeowners’ policies don’t cover damage due to lack of maintenance by the owner.
Condominium and Townhouse Insurance works a little differently. Townhouses and condominiums generally have associations, which take care of maintenance. Associations have an insurance policy paid for by monthly dues from owners. This generally covers exterior damages and recovery. Anything within the four walls of the building is generally the responsibility of the owner. This includes lighting fixtures, pipes within the four walls, appliances and flooring. Personal property damage and loss is also the responsibility of the owner. If the unit is a rental unit, the company renting the unit usually requires insurance. If you rent on you own, insurance is so important to cover the possibility of damage done by a tenant, from holes in the wall to theft and more. You really can’t be too careful these days.
Secondly let’s look at rental units and Condominium Insurance or Renter’s Insurance. Most renters think they don’t need to worry about insurance, but what happens if the place is broken into and jewelry, televisions and stereo equipment are stolen? What if you lose your computer? If a pipe bursts and your personal effects are damaged, you aren’t covered under a general policy on the place. Personal effects need separate coverage. When choosing an insurance policy, consider the amount of the deductible. If you look at a policy with a $10,000 deductible, ask yourself if you have $10,000 worth of possessions that are worth replacing. It may be worth paying a bit more monthly for a low deductible.
Another question to ask is whether you want Replacement Cost Coverage or Actual Cost Value Coverage. Actual Cost Value Coverage means if an item is stolen or damaged, the insurance agent will look at the cost of the item and deduct a portion for depreciation. The longer you’ve owned the item the less money you will receive to replace the item. With Replacement Cost Coverage, you receive the amount it would cost to replace that item today. Replacement Cost Coverage Insurance will cost a little bit more, but in the long run, if your computer is stolen, do you want to be able to buy a new computer and get back on your feet immediately or would you rather receive a portion of the cost and have to save up before you can replace your computer?
Over the next three weeks we will look at each of the policies in further depth. For now, if you have questions about homeowners insurance, condominium insurance or renter’s insurance, call Richard Turner San Diego Insurance Agency. We can answer any questions you might have, set up a new policy or review an existing policy.