Understanding the Basics of Homeowners and Renters Insurance

Tue 24 January 2017

▶ Looking at the six coverages common to all Homeowners insurance’s policies
▶ Choosing limits for your home and its contents
▶ Determining what kinds of losses you want covered
▶ Lowering your risk and reducing your premiumsHomeowner’s insurance policies are outstanding values — they offer
tremendous amounts of coverage for very little money. But they’re
also, in my opinion, the most dangerous personal policies you can buy,
because they have the largest number of exclusions and limitations.
When you’re buying homeowner’s insurance, you have to figure out which
risks you’re exposed to that fall outside the basic box of coverage. Then you
can develop a strategy for dealing with those risks.
Most people make the mistake of shopping for their insurance based on price
alone. What they usually end up with is the wrong coverage for a cheaper
price! (See Chapter 4 for more on the right way to buy insurance.)
To buy the homeowner’s insurance you need, first you have to understand
something about the basic homeowner’s policy. In this chapter, I explain the
fundamentals of homeowner’s insurance. In Chapters 10 and 11, I show you
the different types of coverage gaps and how to protect yourself from them.