Home Insurance Coverages
A home is often a person’s most valuable possession, yet many homeowners have only a vague idea of what their home insurance policy covers. And too often, it is not until disaster strikes that they find their insurance coverage is inadequate.
Your trusted advisors at the Legacy Insurance Advisors can help you and your family with homeowners questions and coverages. Click here to get an homeowners insurance rate quote now.
A standard Minnesota homeowners insurance policy should include enough dwelling coverage to pay for the replacement or repair of your home when, and if, it is damaged in a covered peril.
Other structures, such as detached garages or sheds, would also be covered under a standard Minnesota home insurance policy.
A Minnesota home insurance policy will also typically provide coverage for the contents of your home including furniture, electronics, clothing and other personal belongings.
Loss of Use:
If your Minnesota home is damaged in a covered peril, ‘Loss of Use’ coverage pays for alternative accommodations and living expenses while you are unable to live in your home.
Personal Liability Protection:
In Minnesota, your standard homeowners insurance policy will typically provide financial protection in the event of a lawsuit where you have caused damage or bodily harm to another person or their personal property.
Medical Payments coverage, or Minnesota MedPay, offers reimbursement for medical bills if someone other than you or a family member is injured on your property and a lawsuit is not involved.
Flood Insurance Basics
What every Minnesotan should know about flood insurance
As the second largest natural disaster, floods are widespread and can cause much more than property damage. For many Minnesotans without proper insurance, flooding can cause severe personal and financial losses.
Three truths about flood insurance:
A standard homeowner's insurance policy does not provide flood coverage.
You cannot depend on disaster assistance. You only get assistance when the President declares a disaster. Since less than 50 percent of floods are declared disasters, most flood victims are on their own
Paying for flood insurance is less expensive than paying back a disaster loan. Most disaster aid comes in the form of loans, which must be paid back. The average loan payment on a $50,000 disaster loan is $240 per month ($2,880 per year) for 30 years compared to a $100,000 flood insurance premium which is about $400 per year ($33 per month)
Your trusted advisors at the Legacy Insurance Advisors can help you and your family determine the right amount of coverage for you. Click here to get a Flood insurance rate quote now.
More information about flood insurance is available at Flood Insurance Information for Minnesotans publication.
Renters Insurance Coverages
What is Renters Insurance? Renters insurance protects your personal property against damage or loss, and insures you in case someone is injured while on your property. The premiums for renters insurance average between $15 and $30 per month depending on the location and size of the rental unit and the policyholder’s possessions.
Your trusted advisors at the Legacy Insurance Advisors can help you and your family protect what’s important to you. Click here to get a renters insurance rate quote now.
To Purchase or Not to Purchase?
As with any insurance policy, you should evaluate the benefit of coverage on an individual basis. Your landlord’s coverage will take care of damage to the building’s structure. However, if you want to protect your personal belongings, you may want to consider buying a renter’s insurance policy.
In addition to personal belongings, some policies will also cover living expenses if your apartment or home is uninhabitable due to damage. Many individuals go without this coverage, because they wrongly assume their property owner has insurance coverage that will protect them against any loss. Regrettably, it's unusual when a landlord maintains renters insurance for protecting the personal possessions of a tenant. Landlords normally have a policy for the physical building they own, but not for a renter's personal possessions. Additionally, for people such as young singles who live with one or more unrelated roommates, each individual renter may need his/her own renters insurance policy to protect his/her own possessions as some policies only cover one individual renter as opposed to everything in the rental itself.
Most renters insurance policies provide two basic types of coverage: personal property and liability. Personal property coverage pays to repair or replace personal belongings if they are damaged, destroyed, or stolen. Liability insurance provides coverage against a claim or lawsuit resulting from bodily injury or property damage to others caused by an accident while on the policyholder’s property.
Which Type is Right for You?
There are two standard renter’s insurance policies:
The Broad Form covers personal belongings against specific events, such as fire or theft. This is the most commonly purchased renter’s policy. Typical coverage under this form includes damage from fire, lightning, explosion, smoke, vandalism, theft and water-related damage from property utilities. This is the most commonly purchased renters policy.
The Comprehensive Form provides coverage for a range of events, unless specifically excluded by the policy. Considering the potential amount of coverage, the premiums for this policy may be higher. Location also may be considered when choosing your form. If you live in an area prone to violent storms, such as hurricanes, consider purchasing a comprehensive policy that specifically addresses storm damage.
If you have unusually expensive items, such as fine jewelry or an art collection, you may consider adding a “rider” to provide extra coverage. Your agent can help you determine if an additional rider is needed.
Actual Cash Value vs. Replacement Cost
One important factor to look for when shopping for renter’s insurance is “actual cash value” vs. “replacement cost” coverage. While it may not affect your short-term premiums, it may make a large difference in your claim submission.
Actual cash-value coverage, as the name implies, will reimburse you for the cost of the property at the time of the claim, minus your deductible. It’s important to account for depreciation when considering this coverage option. For example, if you lose an audio system that was purchased five years before the claim, you will be reimbursed for the current value of the system. This may result in a lower claim payment than you expect.
Replacement cost coverage, on the other hand, will reimburse the full value of the new audio system — after you purchase the new system and submit your receipts. While the up-front cost is greater with replacement cost coverage, you are more likely to receive accurate compensation for your possessions.