Homeowners Insurance

Katrina and Rita have brought the importance of adequate homeowners insurance to our consciousness as we imagine how any devastation, whether it is hurricane or fire, will affect our home. Many of us carry only the minimal amount to satisfy our mortgage holder and are woefully under insured. Others of us are ignorant of how much we actually need, and just renew our policy from year to year, regardless of how our home and circumstances have changed. One recent study cites 60% of homes in the US are undervalued by over 20%. That can translate into big dollars if you lose your home or even part of your home. If you are in that category, consider that your home's insured value is $300,000 but rebuilding it would come in over $380,000, and that $80,000 comes out of your pocket.

One of the first home insurance rules...review your policy each year! Before you make out the check, sit down and go over what's in the house, what you have improved upon, added to, etc. so you know how much coverage you need to replace your home in case of damage. If you have a new addition to your home, been given Grammy's autographed letter from George Washington, added a new computer system, or even indulged in a large new plasma TV, keep in mind your insurer needs to know these things to make sure you are adequately covered.