Finding the right home is only part of your real estate success. Making sure your home is protected by proper coverage can be equally important. Alex Wodarczyk of Liberty Mutual Insurance enjoys finding the proper protection for his clients. He offers this advice to homeowners seeking home insurance:
1. Know the difference between your replacement cost and actual cash value. Ask your insurance provider to clarify what they are providing in your policy. Replacement costs can be calculated by removing the cost of your lot, and determining the cost to replace every part of your home, at 100% of the typical cost for the building and supplies. Actual cash value is a different measurement of value. The cash value determines the cost of rebuilding your home, but factors in the depreciation of the various parts. For example, if your roof is 10 years old, actual cash value will only cover the current value of your existing roof. Due to depreciation, this will not be enough to replace it. A replacement cost value would cover the entire cost of a brand new roof. Understanding this difference is key to ensuring you have the coverage you want when you need it most.
2. Confirm if water back-up is part of your policy. A water back-up is caused when the sewage drain backs up and enters your home. This is different from other types of water damage (like a basement flooding after heavy storms). A water back-up is not always a standard part of your insurance coverage, but it's likely an important thing to consider. If the base plan doesn't include this coverage, it can be added as an extra endorsement.
3. Consider what options you have to lower your rates. Speak with your insurance provider to learn if there are specific ways you can act now, and lower your costs over the long term. For example, replacing your roof could save you a significant amount on your insurance premiums. Alex also recommends talking to your provider about bundling discounts. If you have your auto, life, home and umbrella coverage with the same carrier, you will receive a greater discount and save more money.
Alex enjoys helping clients understand their insurance needs, and finds great satisfaction in knowing he's helping them protect their most valuable assets. He lives on the near east side of Madison, and loves the character and the entrepreneurial nature of Madison. You'll find him enjoying the many farmer's markets and exploring the city with his fiancee' and their new dog. To speak with him about your insurance needs, call him at (608) 535-3076 (his last name is pronounced "wood-ar-check") or email him at alex.wodarczyk@LibertyMutual.com.
This article is published courtesy of: Dan Miller, REALTOR Mad City Dream Homes & RE/MAX Preferred
1. Know the difference between your replacement cost and actual cash value. Ask your insurance provider to clarify what they are providing in your policy. Replacement costs can be calculated by removing the cost of your lot, and determining the cost to replace every part of your home, at 100% of the typical cost for the building and supplies. Actual cash value is a different measurement of value. The cash value determines the cost of rebuilding your home, but factors in the depreciation of the various parts. For example, if your roof is 10 years old, actual cash value will only cover the current value of your existing roof. Due to depreciation, this will not be enough to replace it. A replacement cost value would cover the entire cost of a brand new roof. Understanding this difference is key to ensuring you have the coverage you want when you need it most.
Alex enjoys helping clients understand their insurance needs, and finds great satisfaction in knowing he's helping them protect their most valuable assets. He lives on the near east side of Madison, and loves the character and the entrepreneurial nature of Madison. You'll find him enjoying the many farmer's markets and exploring the city with his fiancee' and their new dog. To speak with him about your insurance needs, call him at (608) 535-3076 (his last name is pronounced "wood-ar-check") or email him at alex.wodarczyk@LibertyMutual.com.