If you’re a homeowner who has made the choice to invest in a homeowners insurance policy, congratulations on making the responsible choice! The next step is to make sure you get a policy that works for your lifestyle and your budget. This article is going to outline a few tips everyone should keep in minding when deciding which homeowners policy is right for them.
There are three basic types of homeowners policies: comprehensive, basic or named perils and broad. Let’s take a quick look at the difference between each policy type.
A comprehensive homeowners insurance policy covers property and possessions, but with a list of exclusions. It’s that exclusion list is the crux of whether this type of policy will work for you. Most of these policies exclude things like flooding, wildfires and other types of natural disasters. If your property is in an area that is considered at risk for that type of thing, you may want to consider a different policy, or taking out an extra policy specifically to cover the risk you’re worried about.
Basic or Named Perils
As the name implies, this is a pretty barebones type of homeowners insurance policy. The advantage of this type of policy is that they tend to be cheaper and very easy for anyone to understand. A basic or named perils policy only provides coverage for what is specifically stated in the policy. If it’s not named there, that policy does not provide any type of coverage.
A broad policy is a combination of the comprehensive and basic or named perils policies. This type of policy provides comprehensive coverage for the home and basic coverage for belongings. Broad policies often provide additional coverage based on the needs of individual policyholders.
Broad homeowners insurance policies tend to be more expensive, but they also provide more coverage. If you can afford it and want the peace of mind a broad policy is likely the right choice for you.
Of course, there are different types of policies within those three categories as well. Most homeowners insurance policies are tailored to the individuals that purchase them. Take the time to do your research and make sure you get the coverage you need to make your homeowners policy effective.
To learn more about your current policy, or to get details about a new one, reach out to TGS Insurance at www.tgsinsurance.com.