Do I really need homeowners insurance?

Homeowners insurance protects one of your largest financial investments. The loss of a home and its contents would be devastating. Also, while not mandated by law as in the case of auto insurance, most mortgage companies require insurance on the residence while the loan exists to protect their interests in the property.

How much liability insurance should I have? Should I purchase an umbrella policy?

The liability coverage of your homeowners policy provides personal liability protection for your negligent actions other than while operating a vehicle. The coverage is typically $300,000, but in most policies can be increased to $1,000,000. An umbrella policy provides additional liability coverage beyond the limits of your auto and homeowners liability insurance. Your need for an umbrella policy depends on your assets and your desire to protect yourself from losing those assets as the result of a lawsuit.

Does my homeowners policy cover my in-home business?

Homeowners insurance is not designed to cover business exposures. Therefore, the amount of coverage for office equipment is very limited. In addition, there is no liability coverage for activities related to your home-based business. There are special policies designed for in-home businesses including:

• Incidental Business Endorsement. -- endorsement added to your existing homeowners policy that covers equipment used in your business.
• Business Owners Package -- separate policy that includes property and liability coverage.
• In-Home Business Owners Policy – a single policy offered by some companies that combines homeowners and business owners coverage into a single policy.
• I am only renting an apartment; do I really need insurance?

Don’t underestimate your need for insurance. Renters insurance provides important coverage for you and your personal property, whether you are renting an apartment, home or condo. Renters insurance provides protection should your belongings be stolen, damaged or destroyed. It also provides liability coverage should you be sued for bodily injury or property damage.

What is the difference between “replacement cost” and “actual cash value”?

Replacement Cost – the cost of replacing an item without any deduction for depreciation. This coverage pays the amount necessary to “repair/replace with like kind and quality” at the current price.

Actual Cash Value (ACV) – The replacement cost of the item, less a deduction for depreciation.

What is “loss assessment coverage?”

If you belong to a homeowners association you can be subject to assessments whereby the association charges (assesses) each property owner to cover the cost of losses to common areas, legal fees, or association insurance deductibles. The loss assessment coverage included in your policy is to cover these types of assessments.

What is the difference between an “all risk” policy and a “named peril” policy?

An “all-risk” policy provides coverage for losses to the property from all perils except for those specifically excluded in the policy. A “named peril” policy specifies certain perils for which it provides coverage.

If you have any other questions about a particular homeowners insurance coverage, please call one of our specialists or email us at info@premierone.com.