When purchasing insurance, building owners must determine exactly what they require before deciding on policy coverage. While basic building insurance coverage provides protection from fire, smoke damage, vandalism, explosion, earthquake and some other listed perils, some owners may require additional optional insurance coverage due to the location of their property or specific perils connected to their business. Most mortgage lenders require the borrower to purchase a building insurance policy to protect their own interest in the loan. If you are fortunate enough to have paid off your mortgage, it is still very important to have this insurance in place.
Basic Building Insurance
If your home is damaged or destroyed, the costs of replacement and rebuilding are covered by basic coverage. The damage to your building must be completely out of your control. Damage or destruction caused by personal negligence is not covered in almost all instances. Most policies will cover the following perils and damages.
Fire and smoke damage
Burst water pipes
Tree or branch falling on building
Internal damage to walls and ceilings
Built-in cabinets, drawers, wardrobes
Damage to wallpaper and paint
It is very risky to not have this type of insurance. Storms and other weather events and disasters occur with little warning. Insurance cant be purchased when you find out a storm is about to strike your area. It must be in force prior to the event that causes the damage or total destruction.
Many people choose to purchase an unlimited coverage policy. This type of insurance coverage will pay the building owner automatically and will replace all damaged furnishings and appliances, as well as repair or replacement of the building structure. Its important to realize that not all perils are covered under this policy. It covers the same perils as basic insurance for buildings. The type of damage that occurs is more important than the cost of repair and replacement in this type of coverage.
Quite often your insurer will combine description insurance and building insurance in one policy. This will save some you some money. The descriptions of your building are covered by this insurance and that includes almost everything in your building. You may find some overlap in coverage between building and descriptions insurance. Your policy will cover most of the following damages and replacements.
Your home furnishings
Broken windows, mirrors, other decorative glass
Home office equipment other than electronics
Stolen credit card losses up to the limit
Replacement of damaged building locks
Money kept in the home up to the limit
Deeds and document theft up to the limit
Satellite equipment damage up to the limit
Lost freezer descriptions up to the limit
Additional Options That Can Be Added To Your Policy
Some people need to add additional items to their insurance coverage to be sure they are fully covered in the event of a disaster or crime.
1. Accidental damage coverage can be added to cover damage you may cause while doing your own remodeling work. An example is putting your foot through your ceiling while adding new insulation.
2. Accidental descriptions damage is an option that replaces furnishings to your home that you accidentally damage. An example is spilling paint on the carpet.
3. Emergency repair options are available to cover the cost of a workman when a pipe bursts or similar event takes place requiring immediate repair. It will cover calling a tradesman and the labor and repair expense up to a certain limit.
4. Add an option to protect all your personal belongings, including your electronics. This coverage pays for damage, destruction, or theft.
5. A Legal liability option will protect you in the event a lawsuit is filed against you. An example is a person trips on something left on your steps, falls, and is seriously injured. This option will assist with your legal fees.
Understanding the comparisons between insurance types makes it easier to choose the right insurance to protect you, your family, and your home.
The author of this article Sam Jones was recently using the uSwitch website http://www.uswitch.com/home-insurance/building-and-descriptions-insurance/ to compare building insurance deals.
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