(Photo Credit to Images_of_Money on Flickr)
The storm is past. The wildfire is out. But your home is gone. Now what? As always, plan ahead!
Homeowner’s insurance is not very expensive, and it is common to roll the monthly premium into your mortgage payment (along with taxes – it’s called ‘escrow.’) Homeowner’s insurance can be as little as $100/month, rolled into your payment so you don’t even know it’s there. It can provide you a tremendous amount of peace of mind during a disaster. Consider:
Where to Go Right After the Storm?
Homeowner’s insurance can provide you an instant voucher to stay in a hotel immediately after the crisis. It can also provide food, immediate replacements of necessities such as clothing and toiletries, and perhaps even temporary transportation to work.
Homeowner’s insurance can ALSO provide a place to rent while you are in the process of rebuilding, or searching for a new house. It can pay your rent for a certain period of time, such as a year.
How Do You Rebuild?
Homeowner’s insurance is designed to pay off your existing mortgage, and then help you take out another one, for either a re-build or a new house. You will still have a mortgage, but it will be on your new, re-built home.
What About Your Stuff?
Homeowner’s insurance can also provide extra money to replace the contents of your home. Total replacement is the best option. You will receive the cost to replace your appliances, furniture, etc., rather than just the current value, which can matter a great deal if you have old or used contents. Take photographs of every room in your house so you have a record of what you need to have replaced. Open cupboards and take pictures. This is not to document your tidiness deficiency, but rather to prompt your memory. When you see the outer items of a cupboard, you will be more likely to remember what is in the back. Put the photos in a safe place, away from the home.
A home safe might be a good option if it is strong enough to withstand the high winds of a tornado and the high heat of a wild fire. Another terrific option is a bank safety deposit box. They are only around $20 per YEAR! Very affordable for the peace of mind it offers. A free option is a friend or relative’s home, in a region quite far away from where you live. You don’t want to keep it near your home, because a natural disaster could take out both homes! If you store your photographs on a digital device, be sure it is up to date. For example, if you currently have important information on a floppy disk, it will be very difficult, if not impossible, to retrieve that information.
What if You Rent?
Homeowner’s insurance is not just for homeowners. There are renter’s policies. These will cover the contents of your rented home or apartment. While you are at it, check on your liability should a fire start in your apartment, perhaps from a candle of defective electrical item.
What Kind of Insurance Should I Buy?
Shop for homeowner’s insurance like you do anything else. Consider the biggest risks in your area. Check on the availability of earthquake, tornado, flood and fire insurance. Check on insurance if someone drives a car into your house. Check on insurance if somebody gets hurt at your house. Often, discounts are available if you buy both your auto and home insurance from the same provider.
As difficult as it would be to lose your home and the contents therein, imagine the huge relief of automatically having a place to live, money to replace the immediate necessities and money to replace your stuff. That peace of mind is so very worth the minimal monthly costs of quality homeowner’s insurance.
