Flood and Renters Insurance
Your home is your castle. It is where you store and use all
of your most personal items. Your family photo album is probably stored on a shelf in your bedroom closet,
and those beautiful antique lamps you got on your honeymoon are carefully placed on the end tables in your living
room.
If your house burns to the ground, or a thief breaks in while you are away from home, you may lose valuable
possessions and items of sentimental value.
These items may be irreplaceable, or they may be items you can purchase in a
store. The fact is: you need the money to build a new home, buy new furniture and replace those items
you use every day. Without insurance you may be homeless and you may find it difficult to replace all
of your personal possessions - clothing, towels, blankets, mattresses, musical instruments, furniture, sports
equipment, kitchen articles, toys, TVs, electronics, and computers to name a few. You CAN own a home
without obtaining a homeowner’s policy. However, if you finance your home, your mortgage broker or
lender WILL require you to have insurance to protect the investment of cash they have made in your
home.
If you live in a flood zone or in an area that is likely to experience earthquakes, the lender or bank will also
require you to carry flood or earthquake insurance. If you purchase a condominium or co-op, the board
or association will probably require you to buy insurance to protect the other homeowners, and the common areas
that may be affected if a fire starts in your home or some other accident or disaster
occurs.
If you own a private home, and your mortgage is paid, you
do not have to carry insurance under law, but it is wise to do so. Unless you are independently wealthy
and can replace your dwelling and all the contents within it, you should have insurance to protect you from
property damage, or theft, and to protect yourself from litigation and liability if someone is injured on your
property. Let’s look at the various types of insurance you might need or want if you own a home, co-op or
condo, or rent an apartment.
Here are some definitions:
Ø Title Insurance – This policy is purchased when you are
buying your home. A fee is paid to the title company and included in the closing costs. The title
company performs a ‘title search’ in all available public records, to be sure that the title to your new home is
free and clear of any liens or litigation. They will look for things like liens for unpaid property
taxes, liens from building contractors, heirs of previous owners, or errors on deeds.
Ø Homeowners Insurance - This policy provides coverage and
reimbursement if your home, condo or property are damaged, and also covers you against any liability you may have
if someone else is injured on your property.
Ø Renters Insurance – These policies provide coverage
and protection against loss and damage or destruction for your possessions inside a rented house or
apartment. Keep in mind that your landlord is under no obligation to cover your property for fire
damage, theft or other destruction, so if you want insurance, you have to take out a Renters’ Insurance
policy.
Ø Flood Insurance – You can get a flood insurance policy
as a homeowner or a renter or tenant. If you live in a designated flood zone, you will need
flood insurance. Flood insurance does not take effect for 30-days, so you’ll need to take that time period
into consideration when you apply for a policy. Now that you know the basic types of insurance that apply to
dwellings, homes, condos and apartments, let us examine the detail of each of these types of
policies:
Renters Insurance
Flood and Earthquake
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