From your standard policies to the types of insurance you forgot about, here’s what you should know about coverage.
When most people hear the word “insurance,” they first think of the standard trio of home, life and auto coverage (and for good reason — those policies are important).
But many people would benefit from additional protection provided by policies they may not even know exist.
Here’s a refresher on the basics as well as a few commonly overlooked policies to consider.
It’s up to you to choose the policy and limits that meet your needs, but it’s best to insure your home for at least 100% of its estimated replacement cost — the cost of repairing or replacing your home to restore it to its original condition. Estimated replacement cost is different from market value or purchase price.
If you select a homeowners policy amount lower than the estimated replacement cost, certain coverages may be unavailable to you. Periodically review your policy and limits with your agent and notify your agent of any changes or additions to your home.
Car insurance Auto insurance
is required in almost every state to operate a vehicle — but the cost can vary widely. This is partially determined by your vehicle type, your age as well as your car’s and the coverage level you select, but it can also be affected by other factors. People who live in densely populated areas — noted for higher occurrences of crashes and theft — will likely pay more for auto insurance than those who live in rural areas, where crashes and theft are less prevalent.
Homeowners policies typically exclude flood coverage. Adding coverage may be worth looking into, no matter where you live. According to FloodSmart.gov, more than 20% of all flood claims happen in moderate- to low-risk areas. Agents enrolled in the federal government’s NFIP Direct Program are able to write and service flood insurance policies for qualifying homes directly through that program.
Personal articles policy While home policies typically cover many items inside the house, a personal articles policy provides even broader protection. This can include coverage for items ranging from jewelry and fine art, to cameras, musical instruments and sports equipment. In most cases, a personal articles policy has no deductible and will cover the full replacement cost of your items anywhere in the world.
So if you’re on vacation and someone runs over your expensive skis or snowboard with their SUV, this is the policy you need.
Off-road vehicle insurance
Insuring your car is one thing. Insuring an off-road vehicle — such as a snowmobile, golf cart or ATV — is another. An off-road vehicle policy can cover you in case of bodily injury or property damage as well as damage to the vehicle itself due to accident, theft, fire, vandalism and other losses — even when in storage.
Most people protect their family from the prospect of lost income in the event of their own death through a variety of life insurance. But disability is another important consideration. If you’re unable to work due to sickness or injury, disability insurance can provide protection to help you pay your mortgage, rent, car loans and other regular living expenses. Short-term disability insurance provides funds to help you meet monthly obligations in the case of a temporary illness or injury, while long-term disability policies help replace lost income in case you become permanently disabled.
Just because you don’t own a home doesn’t mean you don’t have a home that needs protecting. And yet, well under half of tenants have one of these insurance policies. Renters insurance (sometimes called “apartment insurance”) covers personal property such as electronics, furniture and clothing from loss due to factors such as fire, water damage, theft or vandalism. Renters insurance even covers your stuff when it’s not in your apartment. If your laptop is stolen from your vehicle or your bike is stolen while you’re at work, for example, these losses are likely covered.
If you need to file a claim, a case manager will work directly with your credit card companies, credit bureaus, creditors and other financial institutions for up to a full year after a covered incident to restore your identity. The coverage also covers up to $25,000 in reimbursements for necessary and reasonable expenses incurred to restore your identity — including credit reports, notarization and attorney’s fees.
While your family may have health, dental or vision insurance, those policies don’t extend to your four-legged family members. Pet insurance lessens your financial burden when it comes to medical care for your pet and often includes tests, surgeries and the treatment of breed-specific conditions. That can mean fewer tough decisions and more time spent with your furry best friend.
No, this isn’t insurance to cover your collection of antique parasols. Rather, a personal liability umbrella policy provides protection in case you experience a major insurance claim or lawsuit. While underlying insurance policies such as home and auto do provide some protection, an umbrella policy can cover claims and judgments above the standard limits of those other policies — typically at a very reasonable price. Personal liability insurance also may cover against certain claims (such as defamation of character, libel and slander) that are typically not covered by other policies.
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