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Homeowners Insurance in Frisco

One of the most important things you can do to protect your investment is to purchase Texas homeowner’s insurance. Homeowner’s insurance pays to repair or replace your home or personal property if it is damaged or destroyed by something covered under your policy. Learning about homeowner’s insurance prior to buying a home is very important. This is especially important in Frisco, TX because home values average more than $200,000,

Available Coverage

Usually, when you purchase insurance to cover your home, there are five different types of coverage that are included in your policy. Dwelling coverage pays for damage to your house and €unattached structures€ like fences, sheds, and even the garage. Personal Property coverage is for personal items like clothes, furniture and appliances. Liability protects you if you are sued over damage caused to another’s property. Medical Payments coverage assumes the cost of treating someone injured on your property and Loss of Use pays for additional expenses if you cannot remain in your home because of covered damage and need to find another place temporarily.

Types of Policies

In Texas, it is possible to purchase one of two types of polices- Comprehensive Coverage or Specified Perils Coverage. Comprehensive Coverage, also called €all risk€ coverage offers the broadest protection possible. Generally, everything is covered unless your policy specifically excludes it. Specified Perils Coverage offers more narrow coverage with only the specific €named€ perils in the policy covered.

It is important to note that even with an all risk policy, there are usually several exclusions. Make certain to read your policy for exclusions to ensure the perils you want protected are covered. For instance, a typical homeowner’s policy does not cover damage caused by floods, earthquakes, termites, normal wear and tear, and mold.

Important Terms

Insurance policies are filled with unfamiliar terms, often making it difficult to understand exactly what is covered and how. Understand the following terms can make it much easier to read through your policy:

Replacement Cost refers to the dollar amount of replacing or repairing your home. This figure is based on current construction costs and is completely different from market value and does not include coverage your land.

Actual Cash Value is simply the cost to replace your property less depreciation. Actual cash value offers less coverage because depreciation is taken into consideration.

Policy Dollar Limits are the maximum amount your insurance company must pay if your home is damaged or destroyed. It is critical you have enough coverage to avoid financial distress. As it relates to personal property coverage, most insurance policies only cover up to a certain amount for valuables and you will possibly have to seek additional coverage.