When your home is damaged, you rely on homeowners insurance 10-15 to pay for repairs or re-building as well as to replace your personal contents inside the home. When you purchased your insurance coverage, you may have assumed that the coverage would meet all of your needs. However, your needs for homeowners insurance can change over time. If you have not reviewed your policy within the last year, there are several good reasons why you should. For detailed instructions on getting the proper homeowners insurance in Texas please visit the following URL: https://www.texasquotes.com/homeowners-insurance/.
Rising Property Values
In Texas, many areas are experiencing rapidly rising property values, and some areas have seen a seven percent increase or more over the last year. In addition, construction costs are also increasing in many areas of the state. This means that it may cost you much more to repair or rebuild the home this year than it did last year. Many homeowners insurance policies have a clause that automatically raises the coverage to accommodate rising costs and home values in the area. However, the actual value of the home may not be appraised, and there is a possibility that the automated process through the insurance company is not sufficient. This is particularly true if you have made improvements to the home within the last year that have further increased the value beyond market appreciation.
New Contents Inside the Home
A homeowners insurance policy will also provide coverage for the personal contents inside the home. The contents in your home may not change much for years, or the contents may change very significantly in a short period of time. For example, if you remodel the home and buy new furniture for several rooms at the same time, the valuation that you place on your new furniture may be several thousand dollars or more higher than what you placed on your old pieces. You may have furnished a room that was previously used for storage, bought new appliances in the kitchen, added an outdoor living area to the backyard or made some other significant changes to the home that have increased the amount of money you potentially could lose in a damaging event.
Changes in Your Financial Situation
A key component to your coverage relates to your insurance deductible. A homeowners insurance deductible in Texas is typically between one to two percent of the home’s value. First, because home values have increased, this means that your deductible may have increased slightly. If you adjust your coverage on your own, your deductible will also increase. Some people may have had a great year financially and may be agreeable to a higher deductible and a lower premium. If you have the money available in your savings account to pay the higher deductible, this may be an option for you. However, you should be aware that this will impact how affordable it is to file a claim going forward. If your financial status has increased significantly or if you entertain more at home, you may also consider the benefit of increasing your liability coverage.
Homeowners insurance is a requirement for homeowners who have a mortgage on their home, and it is highly beneficial for all homeowners regardless of their mortgage status. With proper coverage, you can decrease your exposure to liability and more easily pay to repair or replace the home and its contents after a damaging event. Coverage needs can change, and homeowners should not rely on the automated process by insurance companies to keep them fully insured. Because of how important coverage is, it is smart to review your coverage with your insurance company annually.