Homeowners insurance policies primarily cover the structure and basic features of your home, such as the walls, fixtures, cabinets, and utility systems. They do include some coverage for your personal property (furniture, clothes, electronics, etc.), but the amount is minimal. It is important to understand how much is covered under your policy and to consider whether you should buy additional personal property coverage.
Sample Coverage Amounts
If you look through your policy documents, you may find a section that lists specific limits for different types of personal property. The amounts will vary, but here is just one example of what you might see:
|Money & Pre-paid Cards||$250|
|Securities & Debit Cards||$500|
|Theft of Jewelry, Watches, etc.||$500|
|Theft of Silverware||$500|
|Tapes, records, discs…||$500|
|Theft of Rugs||$5,000|
Policies may also have dollar limits per item. Based on this list, how likely is it that the items you own are valued below the coverage amounts? More often than not, they far exceed these limits. For instance, if a diamond ring is stolen, it’s probably worth much more than $500. You must purchase additional insurance to protect your high-priced belongings and collectibles.
Another important consideration are the circumstances under which your loss of personal property is covered. Does your policy only cover certain circumstances such as theft and fire, or does it have an open peril policy for almost any type of damage. Are some circumstances specifically excluded, such as mold and insect infestations? Don’t wait for a loss to learn that you are not covered. Check your policy details now and inquire about additionally coverage as needed.
Should You Buy Additional Personal Property Coverage Under Homeowners Insurance?
Unless you have the ability to re-purchase personal belongings without financial hardship, the answer to the above question is yes. You should buy additional personal property coverage under homeowners insurance. Most people don’t inquire about coverage either because they falsely believe they are fully covered or worry that it will be too expensive. The cost may be less than you think. Furthermore, a total loss without proper coverage would cost you more in the end. For additional information on this topic or to obtain a quote, please contact our team.