Insurance is a necessity when you own a home, but do you know everything you should about how your homeowner’s insurance works? Most people do not.
Asking questions about your policy can help ensure when you need to make a claim, you know what to expect. The Texas Department of Insurance explains you want to ask questions that will enable you to understand how your homeowner’s insurance works.
Coverage questions
You should always ensure you know exactly what your policy covers and what it does not. For example, you should find out if what types of water damage or flooding, if any, your insurance covers. It is also a good idea to make sure you have coverage against other natural disasters.
You also want to know the extent of coverage. For example, will your policy cover your garage or shed? Check for extra coverage, such as hotel stay reimbursement.
Payment questions
If you need to make a claim, it helps to know how the insurer will pay for your losses. Ask how the insurer values your property. Will it pay actual cash value or replacement cost? Find out if the insurer will send the money to you or if it will go to your mortgage company. Learn whether you can negotiate the amount you receive or if the company has set payout rates.
Ask a lot of questions when you get a policy. Once you have one, make sure you read through all the paperwork. If there is anything you do not understand, make sure that you ask your provider and get clarification of anything unclear. You want to be sure that if you need to make a claim, you understand what will happen and how your insurer will handle the process.