There are rumors that many owners do not have enough insurance to cover damages their properties may incur due to a natural disaster. Unfortunately, this is a scary fact that many homeowners are at fault of and most do not even know it. Many people just do not think about checking up on their policies until disaster strikes their Mammoth Lakes home — and then it is too late.
Purchasing the appropriate insurance is not a hard task. Just consult with your real estate agent about what disasters you should prepare for and then call a reputable insurance agent. If you have one, it might be time to revisit your policy, which can sometimes look confusing, so below are a few key words to look for in order to get you on track to having all your bases covered.
- Dwelling or Building Coverage – Look for the amount listed under this title and divide it by the square footage of your Mammoth Lakes home. Talk to your insurance agent, your real estate agent and maybe even your contractor to determine if your current amount is enough. You will want to take into account lot size and building materials.
- Liability Protection – This amount goes toward covering you if someone is injured on your property and decides to sue. Whether your dog bit someone’s hand or a guest slipped around your pool, lawsuits are expensive and most liability policies start at $100,000.
- Valuable Add-Ons – Many policies do not cover valuables, such as art, jewelry, antiques, gold, or wine collections in the basic plan. However, you can usually add them for a small annual fee. So talk to your insurance agent to ensure your precious items are covered.
- Condominium Stipulations – Condominium coverage is different from housing coverage in that it normally only includes the items within the walls of your unit. Just to be sure, take your homeowners’ association policy to your insurance agent for confirmation.
A little coverage goes a long way when it comes to unforeseen disasters. Be sure to give your insurance agent all the information you have. If something looks misleading, then your claim could be rejected. Please call me at 661-979-9000 or email me at [email protected] for more information about insuring your home.
Your Real Estate Agent
According to Consumers’ Checkbook, an independent nonprofit that publishes local magazines in seven locations, including Boston, Chicago, San Francisco and Washington, D.C. similar to Consumers’ Reports, homes that come with warranties sell 11 days quicker and for an average of $2,300 more than those without.
“When you buy insurance against risks you can afford to cover on your own,” the magazine says, “you end up paying for sales commissions and expenses and company profits rather than for claims paid” by the warranty company.
“Buying a home warranty is like buying a (very) limited extended service contract on a bunch of appliances,” says the group.
Nevertheless, warranties have become almost universal in today’s market. Not only do they appeal to would-be buyers, who believe they’re covered should the air conditioner break down or the refrigerator quit working during their first year of ownership, they also appeal to sellers, because they, too, are covered during the listing period.
“Like anything else, make sure you shop around,” says Tim Meenan, executive director of the Service Contract Industry Council, a national trade association that supports home warranties and advocates the regulation of the industry. “Read what’s covered and the exclusions. If you read those two sections, you’ll have a good idea if it’s a policy you want to buy.”
A home warranty service contract isn’t an insurance policy that protects you from loss, but is meant instead to provide service, repair or replacement on a home’s appliances and major systems, such as heating and electric. Typically, contracts are good for one year. “It gives people peace of mind,” he says. “Lots of folks can finance a service contract but cannot finance a new $4,000 HVAC unit.”
The average cost of a basic coverage plan ranges from $350 to $500 a year, with the cost of an enhanced plan adding $100 to $300. Some home warranty companies offer additional coverage for certain items, such as a well pump or pool, for an extra fee. Regardless of the type of plan, homeowners typically pay an additional service fee ranging from $50 to $75 for each repair job.
Here is a general idea of what a homeowner can expect to find in each tier of service:
Home warranty basic coverage:
- Plumbing systems
- Garbage disposal
- Exhaust fans
- Sump pump
- Water heater
- Ceiling fans
- Heating and electrical system components
- Built-in microwave
- Whirlpool tub
If you do decide to purchase a home warranty, be sure to read the fine print, double check what is and what is not covered, realize it won’t replace an appliance – only fix it to working condition.
Sonja Bush is a local Realtor® ready to help you decipher those hidden contracts and ins and outs of buying a home in the Mammoth Lakes Area. Call her today at 661-979-9000 or email her at [email protected]