1. The right limit: You need enough insurance to let you rebuild if you have a total loss. So don’t risk it by choosing a lower limit in an effort to save a few dollars.
One thing to remember when it comes to the right limit is the increased value your home may have after a home improvement project. Always report any home improvement project ASAP to your insurer so they can adjust the limit if necessary.
2. Guaranteed replacement cost: When you have guaranteed replacement cost, you can rest easy knowing that you could rebuild your home after a major loss without worrying about depreciation, policy limits or insurance construction costs once you’ve repaired or replaced the damaged property. This is definitely a better option than actual cash value, which takes depreciation into account when calculating the amount of your reimbursement.
3. Enough liability coverage: Your homeowners liability coverage protects your assets in the event someone gets hurt on your property. It also offers coverage for some incidents that happen away from your home (for instance, if you run your bike into someone).
Lawsuits aren’t as uncommon as you might think, and they have the potential to wipe out many people’s net worth. That’s why most people will want to have at least $300,000 of liability coverage. You might also consider a Personal Catastrophe Liability policy, which adds an extra $1 to $5 million of coverage to your homeowners as well as your auto insurance.
4. Loss of use: If your home was a total loss or became uninhabitable after a covered loss, do you know where you would stay and how you would pay for the extra expense? Loss of use coverage offers you reimbursement for costs to stay at a hotel or rent an apartment in the event of a covered loss.
5. Endorsements that let you customize your coverage: Everyone’s risk factors are different. That’s why you’ll want the option of adding earthquake coverage along with inland marine coverage for high-value items you may own. Another important coverage that many homeowners need is flood coverage, which is offered as a separate policy by most carriers.
Two other endorsements that many homeowners find beneficial are Identity Recovery coverage and Sewer & Drain Backup coverage.
6. A reliable deductible: Many homeowners recovering from a disaster such as a hurricane get sticker shock when they learn their deductible isn’t a dollar amount that they chose, but rather a percentage of the limit on their policy. These named-storm percentage deductibles are almost always higher than dollar-amount deductibles—and sometimes significantly so.
Unlike many carriers, ERIE’s named-storm deductible is a specific dollar amount rather than a percentage of your homeowners limit. What’s more, you also have the option of choosing different dollar-amount deductibles for different causes of loss.
7. The backing of a financially sound company: If you have a claim, you want the backing of a company that can afford to pay it. One way to find out if your company is financially sound is to check the rankings from Ward and A.M. Best that are released each year. In addition to earning an A+ rating from A.M. Best and ranking among Ward’s Top 50 performing property/casualty insurers, ERIE also earned kudos for being among America’s 50 most trustworthy financial institutions.
8. A knowledgeable local insurance agent: It’s no secret insurance that can be complicated. To simplify things and get trusted advice, it’s a good idea to work with an insurance agent you trust. An Erie Insurance Agent is an insurance expert in your community you can count on to help you get the right coverage at the right price.