The US Census Bureau released homeownership statistics for the first quarter of 2021. The report states that 65.6% of Americans now own their homes, increasing from 64% in the first quarter last year, representing approximately 153 million people. Understandably, homeowners naturally want to protect their homes from any destruction. Heath Ritenour, is the chairman and the CEO of the Insurance Office of America (IOA), offers a few basic tips to homeowners that apply to properties of all sizes and types.
Benefits of Having the Insurance
It’s important to have home insurance for various reasons, but the most significant is protection against disasters like fire or theft. Heath Ritenour claims that one way to avoid the risk of losing customer’s money in a home purchase is to require them to have insurance before providing financing.
What Is The Minimum Coverage Requirement?
Homeowners should purchase hazard insurance covers that exactly match the amount they have taken in loans. For instance, a person with a mortgage of $500,000 is required to take out property insurance that at least matches that amount. Heath Ritenour claims that the proportion of a home’s value that has aged out of warranty coverage compared to its additional replacement cost is typically greater for older houses than newer ones. For example, building a home today would cost an additional $50 thousand, 10% more than last year’s construction costs. Today, materials are pricier because of their scarcity in the new global economy and more
Levels in the Insurance Coverage
Having trouble figuring out what type of home insurance to get? Luckily, there are three different options available that may help you decide.
1. Actual Cash Value
Your insurance policy will calculate your total home and personal possessions based on current rates if you had purchased a new TV.
2. Replacement Cost
They based your insurance coverage on the cost it would take to repair your home or rebuild it.
3. Guaranteed Replacement Cost
Homeowner’s insurance is property coverage that insures the residence against fires, dirt, and windstorms or accidents.