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Q&A with Sheppard


Most people do not read their insurance policy….that is, until something happens.  We understand that you may not want to sit down with a cup of coffee on a Saturday morning to read an insurance policy.  You can hit the snooze button now.  While we encourage you to read your policy, the most important thing to do is know your coverage, especially your homeowners and/or renter’s coverage.  In light of the fact that it felt like we were living in a rain forest last week, (wait, do we live in rain forest?) we want to share some frequently asked questions and our answers regarding your homeowners insurance.

Q: Does my policy cover flooding?
A: Typically no.  Most policies do not automatically cover flooding.  Flood insurance is a separate policy from your homeowners insurance.

Q: What is a deductible?
A: A deductible is the amount you will pay out of pocket for any claim.  For instance, we have a hail storm and it damages your roof causing $5,000 in damages.  You have a $1,000 deductible.  You will pay $1,000 and insurance pays the rest.  TIP A higher deductible means lower premiums!

Q: What are the A,B,C, and D coverages listed on my policy?
A: Coverage A is the dwelling coverage — the actual structure of your home.  Coverage B is any other structures on your property (ex. tool shed).  Coverage C is your personal property/contents.  Coverage D provides coverage for you if you have to live somewhere else while your house is being repaired due to a covered loss.   All four coverage are built into homeowners policies.  The amount for each come from a percentage of Coverage A.

Q: Does my policy provide coverage for my diamond engagement ring?
A: A typical homeowners policy will limit the amount it will pay for any valuable items like artwork, jewelry, guns, etc.  You will need to insure these on a separate policy or schedule them on your homeowners policy.

Q: Does my policy cover earthquake?
A: Like flood, earthquake coverage is not automatically provided on a homeowners policy.  However, unlike flood, this can be added onto your existing policy.

Q: How much personal liability insurance should I have?
A:  We always recommend carrying at least $500,000 personal liability on your homeowners policy.  This is an inexpensive coverage and it protects you and your assets.

Q: What endorsements should I have?
A: We recommend you always have the following endorsements: Extended replacement cost on your dwelling, Water-Sewer/Sump Backup and Overflow, Replacement cost on contents, Identity Theft and Personal Injury.

When the going gets tough….ask ask ask!