The recent disasters in California, Texas and Florida and brought many concerns to homeowners
Arizona requires home owners to carry insurance on their property, but how much should you carry and what kind? Insurance companies recommend that the home owner carry four different components of coverage.
Most people carry enough insurance to cover the value of their home. However, it is a good idea to carry enough insurance to cover 100% of the cost to rebuild in case of a total loss of property. As you have seen, a home can be destroyed in a split second and the cost to rebuild may be double the amount that the house is currently valued. Also, take into consideration the cost to rebuild any outbuildings, your pool, or barn that may be on your property.
Insurance professionals recommend that contents be covered at one-half the insured value of the structure. If the home is insured for $200,000, then the contents should be insured for a minimum of $100,000. This might seem excessive, but in the case of a total loss, you will need to replace everything you own, and it will add up quicker than you imagined. It is also recommended that you keep a photo catalog of all your contents along with serial numbers and sales receipts.
Temporary Residence Costs
If the home is damaged to the point that it is uninhabitable, where will you live? You might stay for a few nights in a hotel, but chances are, you might need to rent an apartment or house for several months to establish a temporary residence while your permanent home is under construction. It is a good idea to have insurance to cover living expenses while you are displaced from your home.
This is a requirement in most states and covers your responsibility in case someone is injured on your property or their property becomes damaged. If a tree on your property loses a limb and it damages your neighbor’s custom fence, you will be responsible for the repairs. Liability insurance will cover those costs.
Most insurance companies offer many more products for homeowners and renters as well. It is a good idea to sit down with your insurance agent to discuss your needs. But, the four basic coverages outlined here are the most commonly recommended.