Building And Contents Insurance: What To Look Out For

2007-03-08 10:33:40

( Insurance )



Building and contents insurance from different insurance companies may all look the same to you. It may come as a surprise that there are big differences that matter when you read the fine print on your policy.

Before getting building and contents insurance, you have to make sure you get what you are paying for. You have to make sure you are neither under nor over insured when it comes to your coverage. Being over insured means you are paying higher premiums for coverage you do not really need. Under-insured means paying a lot more out-of-pocket costs if you file a claim because you do not have sufficient coverage. Reading the fine print in your policy will give you a clear picture of the exclusions and limits imposed by your insurance carrier.

If you need coverage for storm damage, some policies will not honor your claims if the water seeps through walls and ceilings rather than through storm-made openings. Your building and contents insurance policy may not even cover water damage if it is damage cause by gradual or slow leaks. Most insurance carriers who offer coverage for floods makes you pay higher premiums if your property is in a flood-prone area.

Another thing to look out for is your coverage for flash floods. Most commercial building insurance have this type of coverage. You may not have adequate flash flood coverage. Some carriers will not pay for your claim if you have extensive flood damage due to a storm but the water takes a couple of days to reach its peak and cause major damage to your property.

If you are under insured, another thing to look out for is an averaging clause. An averaging clause limits the amount your insurance carrier will pay you even if your claim is a fraction of the value of the actual policy.


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