Every year, tons of people loose huge amounts of money in house burglaries, house fires, floods and other unforeseen events. These loses would have easily been compensated had these people availed of insurance for their homes and properties, but the sad fact is – a lot of people don’t or if ever they did ,it is under valued.
Property insurance is pretty much easy to understand, it’s similar to life, health and accident insurances that you take out for you and your family. It shares the same principles as car insurance and even the physical and accidental insurance that you take for your gadgets and other things. Some people may neglect the necessity of having an insurance policy for their property and home, but as we all know criminal rate and costs are rising and the rising price of everything translates into probable losses.
Property insurance works by providing financial and in some instances legal protection against unforeseen events that may damage your property. Depending on your policy, the insurance provider may directly replace the item damaged or release money so that you can replace it yourself.
An insurance provider first appraises the value of your property and drafts an insurance plan or a proposal that will have the company reimburse you with the same amount that your property is valued in the event of damage to your property. The reimbursement may be lesser or greater depending on the agreed contract. Property insurance protects you against two basic things – named and open perils. Named perils insurance protects your property from events that have been clearly stated in the insurance policy. Most of the time Named Perils insurance policies include common disasters like fire, theft, explosions, etc.
Open Peril insurance policies covers all other unforeseen events except those that have been intentionally excluded in the insurance policy that both parties sign. Most insurance policies cover the Home or the dwelling itself. Any damage to the structure of the house will be appraised and reimbursed after the insurance company has done its investigation on the cause of damage – given there is no evidence of foul play.
Structures that are connected to or in close proximity to the house are also considered part of what an insurance policy covers. This could include fences, gazebos, pools, etc. Personal property is also covered in some property insurance policies. Personal property includes furniture, clothing and appliances, the appraiser will most likely take note of these items and will ask you if you want it covered as well. This will increase the premium to be paid but again, in the event of tragedy, you can expect some replacement due to its coverage. Most of the time home owners get a separate insurer for personal items rather than have them covered by same home insurance company.
Reading an insurance policy thoroughly is necessary so that you have an idea as to what is really covered in your policy so that you will not end up quarreling with your insurance provider because something you thought covered was not after all.
