Home and contents insurance is another way to describe homeowners insurance.   It covers your home or dwelling and your personal property.

Your homeowners insurance premiums are calculated based on your dwelling value and personal property value. Home and contents insurance is covered under one insurance policy; not separate policies.

The Breakdown of Insurance Coverages

Your Dwelling Coverage

• When your home and contents insurance policy refers to “dwelling value” this is the amount of coverage that your home is insured for.
• This is important because it is the maximum amount of payout your insurance policy will make to rebuild the structure of the home after any claim.
• The dwelling value is determined by a number of factors. The top three factors are the square footage of your home, the year built and the construction materials.

Your Personal Property Coverage

• Contents insurance is not part of the dwelling amount.
• The basic contents coverage can include but is not limited to your appliances, your furniture, your clothes, your keepsakes and your electronics.
• With some insurance company’s you can add to the contents by adding an endorsement to your policy.

Special Coverages – Scheduled Property

• Art and jewelry coverage is limited within your basic contents coverage.
• To insure expensive art and jewelry you will need to endorse the policy to identify each item for specific value.
• You will need appraisals to verify the endorsed value.
• If your home has many pieces of artwork an appraisal is a very good idea.
• If your jewelry collection has individual pieces worth more than $500 per piece appraisal are strongly suggested.

Insurance Claim

• At the time of a claim your settlement is either made at replacement cost or actual cash value.
• Your home insurance rates will vary depending upon which option you chose.
• Whether you want replacement cost or actual value cost coverage has to be made at the time you purchased the insurance policy not at the time of a claim.
• Depreciation is not factored in on a replacement cost settlement.
• Actual cash value settlements do consider depreciation.

Insurance Premiums

• Home insurance rates start at a base amount based on how much it would cost to rebuild your home.
• Your base amount can be lowered by applying discounts.
• One easy discount to get is to buy your auto insurance from the same insurance company that you buy your home insurance from.
• If you have credit problems you should look into credit repair help because a good credit score can lower your home insurance rates.
• If you maintain a good claim record you can keep your insurance premiums down.
• Lower your insurance premiums through security system discounts, such as fire alarms, smoke detectors, burglar alarms.

It’s not a law that you carry home and contents insurance; but your mortgage company may require that you insure your home.

Home and contents insurance will replace your belongings in the event of a loss.  Imagine the cost to replace your belongings without the help of insurance coverage.

Insurance will give you peace of mind for catastrophes.