6 Frequently Seen Property Insurance Mistakes That You May Literally Lose You Everything

Getting hold of the right home insurance coverage might not be particularly high on your list of financial priorities and, alongside things like investment decisions and estate planning issues, questions about the language in your homeowners plan may seem barely worthy of consideration. Yet, the more successful you become, the more detailed your asset-protection needs are likely to be—and the more you have to lose. Suppose, for example, that in addition to your primary residence—a historic home—you also own a house at the beach and a condo in the city.

For illustration, let us assume that you own properties in 3 states, the value of your collection of Abstract Expressionist paintings has risen quickly and you just volunteered to serve as a director of of a charitable organization. Almost every aspect of your present situation could cost you dearly.

The laws on insurance vary considerably from one state to another, different kinds of property necessitate specialized coverage and art collections and other unique items might prove hard to protect fully. In The Meantime, serving on the board of a charity could subject you to additional personal liability.

Protecting yourself and your family could mean having to purchase additional coverage, although more insurance is not necessarily the answer. Rather, it is important to review your needs, consider specialized policies and coordinate your cover with other facets of your financial situation.

Here are 6 shortcoming that could prove extremely costly.

1. Having gaps in homeowner's insurance cover.

Homeowners need to review their cover regularly to keep up with increasing replacement costs. However, insuring different kinds of property in different locations poses extra challenges. If you buy insurance from more than one carrier you might face contrary rules, limitations, and plan renewal dates. For example, the limit of liability on the plan for a second home could fall below the minimum on an excess liability plan intended to accompany the insurance cover on your primary home and you may end up up being responsible for meeting the difference.

2. Brushing Aside the unique characteristics of your property.

One of the advantages of of affluence is having the means to own great homes but one of the drawbacks is that These may be hard to insure adequately. Standard homeowner's coverage is not going to pay for the hard-to-find materials and craftsmanship required to rebuild that 19th century showplace you've lovingly restored. Coastal homes may well be subjected to hurricane damage, while a house in the mountains of California could be at risk from earthquakes or wildfires.

3. Under insuring art and collectibles.

Ordinary homeowner's plans place a limit on coverage for the loss of such things as furs, antiques, and other valuables. And although you could arrange additional cover, insuring for the real value of a collection of contemporary art will generally require a specialized policy addressing several critical issues.

4. Omitting to organize insurance for employees.

When somebody works for you or your family as, for example, a nanny, landscaper or personal assistant you might have a liability for lost wages and medical expenses if the individual is hurt on the job. Various states require household employers to pay into a workers compensation fund while in other states this is optional. All The Same, providing such insurance may be obligatory for ensuring your financial well being.

5. Ignoring your liability as a board member.

Some form of excess liability coverage could help protect you if you're sued as a director of a nonprofit's board or, if you prefer to have more comprehensive protection, you might want to think about arranging special directors and officers liability insurance.

6. Not getting frequent policy reviews and updates.

Your finances aren't static and neither are your requirements for insurance. The value of your art collection may rise, renovations to your home could mean an increase in the value of your home and the re-titling of assets as part of your estate plan or as a result of divorce, a death in the family, or the birth of a child might require changes to your plan. Even lacking any significant events, you probably need to undertake a review of all your insurance cover at least every two years.

Whatever the level of homeowner insurance you need arm yourself with the very best free and no obligation homeowners insurance quotes today.