A home is a big investment, which is why homeowners insurance is a necessity. Understanding your policy is essential to making sure you have enough coverage. One type of coverage often mentioned is home hazard insurance. Knowing what it covers and whether you need home hazard insurance is critical for protecting your property.
What Is Home Hazard Insurance?
Home hazard insurance is a part of a standard homeowners insurance policy. It’s also commonly referred to as hazard coverage. Hazard insurance specifically covers any damage to the physical structure of your home caused by certain perils.
Which Perils Are Included?
Fire and smoke, windstorms and hail, lightning strikes, explosions, theft, and vandalism are all covered. Other perils also included are falling objects and structural damage due to the weight of ice, snow, or sleet. Any of these perils can cause significant damage. Hazard insurance is a critical part of your homeowners insurance policy.
What Isn’t Covered by Hazard Insurance?
Not everything is covered under hazard insurance. Common exclusions include floods, earthquakes, wear and tear, mold, and intentional damage. Understanding these exclusions helps you determine if additional coverage is necessary.
Do You Need Home Hazard Insurance?
Home hazard insurance is typically a requirement if you have a mortgage. Lenders want to make sure that their investment in your property is protected against significant damage. Even without a mortgage, hazard insurance provides essential protection for your investment.
How Does Hazard Insurance Work Within Homeowners Insurance?
Homeowners insurance policies bundle various coverages together. An insurance agent can work with you to choose the best policies for your needs. You can also reach out at any time if you have any questions.
The most common homeowners insurance options include:
Dwelling Coverage
Protects the structure of your house (this includes hazard insurance).
Other Structures
Covers buildings on your property like sheds and garages.
Personal Property
Protects all of your belongings, such as furniture and electronics.
Liability Coverage
Covers any legal and medical costs if someone is injured on your property.
Loss of Use
Pays for additional living costs if you can’t live in your home due to covered damage.
How Much Hazard Insurance Do You Need?
The amount of hazard insurance you need depends on your home’s value and replacement cost. Replacement cost refers to the amount needed to rebuild your home from scratch, including materials and labor. You need to have enough insurance coverage to fully rebuild your home.
Here are some tips on how to determine the right amount of hazard insurance.
Consider Your Home’s Value
Be sure to check out the current market value and potential rebuilding costs.
Factor in Upgrades
Some people make the mistake of forgetting about upgrades. Include any improvements made to your home.
Contact an Insurance Agent
Handling insurance on your own can be confusing. Always get professional advice to make sure you have adequate coverage.
How to Purchase Hazard Insurance
Buying hazard insurance involves choosing an insurance policy that includes adequate dwelling coverage. You should always obtain quotes from multiple insurers to find the best rate. It’s also a good idea to make sure the policy covers all necessary perils and provides sufficient dwelling coverage.
An insurance agency can help you look for any discounts, such as bundling home and auto insurance or installing security systems. Once you decide on insurance, don’t forget to review the policy details. Going over the insurance coverage and asking any questions is always important to make sure you understand everything.
Tips for Reducing Hazard Insurance Costs
Reducing hazard insurance costs without compromising coverage is possible. For example, you can increase your deductible. Higher deductibles lower your premium but make sure you can afford the deductible amount. Installing alarms, smoke detectors, and deadbolts can qualify you for discounts.
Many insurers check credit scores to determine premiums, so maintaining good credit can lower costs. Combining homeowners insurance with other policies, like auto insurance, often results in discounts. Regularly look over your policy to make sure your coverage meets your needs. An insurance agency can take a proactive approach by looking over your policy to make sure all of your needs are covered.
Need to Learn More About Homeowners Insurance? Give Wellcovered Insurance a Call!
Home hazard insurance is a key part of protecting your home. At Wellcovered Insurance, we will make sure your policy meets your needs. We also provide other insurance options, such as boat, motorcycle, auto, general liability, and more.
Our mission is to always remain helpful, over-communicate, take action, define any problems, and find the best solutions. Staying active in the local community is also a priority.
Give Wellcovered Insurance a call today to learn more about our homeowners insurance!