Making Buildings And Contents Insurance Work For You

Written By: Susan Reynolds on December 22, 2009 No Comment

The whole process of buying a home is such a long and complicated process that it is no wonder that things like your buildings and contents insurance policy does not get the attention that it should. It is usually on the big list of things that have to get done before the closing, as it is a requirement for most mortgage holders. There is the tendency that, once things settle down, your homeowner?s insurance becomes just another bill that you need to get paid each month and renew the same old policy each year that you had when you bought the property. However, now would be a good time to sit down with your agent and take a good hard look at what your policy covers, and even more important, what is not covered. It is time to make your buildings and contents insurance work for you.

It makes sense to most people that your home and property are your biggest investments and that having insurance is not only just a practical idea, but that it is essential. There is a whole list of things that can happen to your home and it seems to go from bad to worse. A partial list would be: flood, storms, lightening strikes, falling trees and fire. You may have to file a minor claim, or you could end up needing to replace or rebuild everything, right down to the very land itself. This is the reason it is so vital that you make sure that your buildings and contents insurance policy is not just a current value payoff, but that it will pay for the entire cost of replacing or rebuilding everything from the ground up. You will also want to make sure that there is provisions included for replacement or repair to all the other structures on your property such as storage buildings, tennis courts, garages, swimming pools, patios and fencing, plus any and all the contents they contain.

Your financial situation changes frequently, as does the replacement values of the buildings and contents that you own, so it is in your best interest to make sure that you review your policy often to make sure that it will not just cover the current value of your property, but that you can actually replace or rebuild if needed. Make it a point to check at least once a year that your policy coverage is equal to or greater than the amount needed to go out and replace the items covered. You can have, with most policies, an automatic rate of inflation increase that is build in, which will help keep things on track, but it is still not a substitute for checking it yourself.

Research on insurance coverage indicates that the majority of people are covered for a lot less than the contents of their homes are worth, leaving them frustrated and disappointed if they ever need to file a claim. Under estimating the value of your buildings and contents is one of the biggest insurance mistakes people make, because they may get paid on a claim, but will not get enough to actually replace the items that were lost or damaged. Making sure you have enough buildings and contents coverage is well worth the time and effort you spend to be able to rebuild your life after disaster strikes. It is also very good to know that you can extend buildings and contents coverage to personal items outside of your primary place of residence as well.

Being able to replace everything in the event of a disaster makes your building and contents insurance valuable enough for you to take the time to review and update, at least once a year, but more often if you are constantly increasing the amount or value of your home and contents. Make sure that your policy does more than just cover the current value of the items and that you will be able to replace them if disaster strikes. Know now what is covered and for how much, because later is just too late.

Susan Reynolds is the webmaster for a leading South African Insurance Provider who specialises in Household Insurance Policies.