What is Home Contents Insurance?

Over the course of most people’s lives, they have built up many assets. Some of it is money they have in their bank account, some of it is their car or their home itself, and some of it is other investments. One of the things that people tend not to be thinking about as much is all of their personal property. People spend a lot of money on goods over their lives. When you purchase a home insurance policy, protecting your dwelling is essential. Have you thought about how much your personal belongings would cost to replace?

Professionals recommend getting enough dwelling insurance coverage to cover the total cost of rebuilding your home. Homes are often a person's largest investment, and repairing or replacing it if it catches on fire or is damaged by other covered perils can cause financial hardship without the help of an insurance plan to protect people financially.

Who And What Does Home Contents Insurance Cover?

Even though the value of your home is likely higher than the values of goods in your home, many people have tens of thousands of dollars’ worth of goods there. These can be difficult to replace without assistance. Item prices add up. People often have TV’s, laptops, computers, furniture, dishes, clothing, tablets, cell phones, appliances like refrigerators and ovens, and many people have artwork and other items that may be expensive to replace.

One of the first things you want to do before buying a home insurance plan/personal property insurance policy is to take pictures and record the expensive things you have in your home. Open all of your closets, drawers, and storage spaces in your home and take notes of what is in there. Pictures are also extremely helpful. These records can be useful for determining how much coverage you want in terms of limits, but also to prove the items are in your home. If you have receipts, keep those as well. It can be smart to upload them to a thumb drive and keep them off-site, so they are not destroyed with your home if major damage occurs. Some people e-mail this information to themselves or keep a record in the cloud.

Take a few minutes to envision losing all of these belongings, and how much it would cost to replace all of them. If you don’t think you have the money to do so, or would rather spend your money on other things if these items are destroyed, consider home contents insurance.

What Are The Coverage Limits Of Home Contents Insurance?

The coverage limits for personal property insurance are most often rolled into your home insurance coverage plan, usually determined as a percentage. This percentage is determined from your dwelling coverage in most cases. If you have dwelling coverage of $100,000, as an example, your personal property insurance might be an additional 50% of that, or $50,000. That would mean you would have $100,000 in dwelling coverage, plus an additional $50,000 in personal property coverage. While this coverage is included in your home insurance plan, you may choose to get additional insurance coverage for high-value items that are not included in the standard plan.

If you need more insurance coverage for your personal belongings, you may need to get additional dwelling coverage to raise your limits. Also, keep in mind that if you purchase high-value items that are not included in your plan, it is up to you to contact your homeowner's insurance company to let them know and add the new items to your plan.

How Much Home Contents Insurance Do You Need?

Making a list of your assets that are covered by home contents insurance coverage is a great place to start, keeping in mind that not everything in your home will be covered. Boilers, carpeting, and other fixtures are not often covered by a plan, and neither are pets that you have. Also not included are your vehicles, though car insurance plans are available, so look into comprehensive car insurance for that.

Also, for people who are renting space in your home, their property will not be covered. They will need to purchase a renters insurance plan in order to have personal property coverage.

Excluding all of these things, make an estimated amount for the replacement cost and/or actual cash value cost of these items. That is a good benchmark for how much coverage you would need.

How Can I Get Home Contents Insurance?

After you have listed off the values of your expensive items and considered how many other items you have in your home, you are ready to start your search for a home insurance plan that fits your needs. This site has the tools you need to find the top homeowner's insurance companies, as well as the best rates for home insurance coverage.

Getting multiple quotes from different companies is a great way to find the best rates, and Homeowners can help. In addition, make sure to look into any discounts that you may qualify for. New home discounts are available, as well as discounts for people who have an alarm system and other modification to the home that reduce risk overall.

Every few years, look into rates again, as different companies use different formulas to determine home insurance premiums. You could save money by switching companies. Also, any new and expensive items should be informed to your homeowner’s insurance provider. Consider whether you need or want actual cash value coverage or total replacement cost coverage, or a combination of both, and research which companies offer the plans you are looking for.