Homeowners insurance: Planning for disaster

The wind-driven wildfires in California serve as a reminder to homeowners that disasters can happen just about anywhere, said Eileen Alt Powell in the Associated Press. Yet many homeowners don’t have the right kind of insurance—or enough of it. While fire and smoke damage are covered under standard policies, you’ll need additional policies for floods and earthquakes. If you haven’t reviewed your policy recently, make sure it will cover the full cost of replacing your home, says Jeanne Salvatore of the Insurance Information Institute. “Pick up the phone and call your insurance agent and ask the key question: ‘Do I have enough insurance to completely rebuild my home if it burned to the ground?’” Salvatore says. If your house is damaged by a natural disaster, file your claim as soon as possible, said Amy Hoak in Marketwatch.com. Your homeowners insurance should also cover possessions, but “check if the policy covers building-code changes, and look for a policy that covers the replacement cost of your possessions—not only the actual cash value of them.” Ideally, you should conduct a household inventory once a year—using video—to keep tabs on all that you own. “Keep the documentation in a safe place, away from home, such as a safe-deposit box at a bank— away from disaster-prone areas.” Once your insurance company puts a price tag on the damage, study the fine print, said Jennie L. Phipps in Bankrate.com. “Read the coverage limits for various types of structures and personal possessions, and check how the insurance company is applying each type.” Take any complaints to the claims adjuster. “If he doesn’t provide satisfaction, go higher.” While most homeowners should have no problem filing a claim on their own, licensed public adjusters can handle the details of your claim—for a fee equivalent to about 10 percent of its value. When the insurer does cut you a check, don’t sign anything that waives your right to make further claims. Some kinds of damage may take weeks to appear, in which case you’ll want the option of asking your insurer for more. “Stay on the lookout for damage.”