As promised, here is my spill about insurance and coverage.

Your Homeowners Policy has 3 key coverages: Your Home, You, and your Stuff.

Home

When is the last time you had someone tell you how much it would cost to rebuild your house in today’s dollars? Probably when you bought it (your appraisal). If your house is covered for $200,000, but it actually costs $275,000 to rebuild it, YOU  my friend have two options. You can come up with the extra $75,000 or you can build a smaller house. This is why it is so important to make sure you have the correct coverage.

You

Most people don’t think that their homeowners can actually protect them personally. This is basically in case someone gets hurt on your property. As you’ve seen on tv, people can sue you for anything. If your dog bites someone, if someone falls on your property, your homeowners will step in and help you out.

Your Stuff

The best way to describe this is if you could take your house and turn it upside down. Everything that fell out, that’s your stuff. Most companies insure your personal belongings for 50-75% of your dwelling coverage. Again, if you had a $200,000 house, your belongings would be covered for $150,000. There are limits to this depending on what you own. Guns, jewelry and furs have specific limits. So it may be best to schedule these items.

Now, as I told you yesterday, I procrastinated and didn’t change my homeowners policy. Allstate has what’s called Claim Rate Guard. Basically, you are allowed 1 claim every 5 years, and your premium will not go up just because of that claim. This, my dear friends, is where I screwed myself. If you do not have this on your policy, and you have a claim, your rates can go up as much as 40%.  In this same package (The Platinum Package) We have a Claim Bonus. For every year you don’t have a claim, you’ll get 5% back on your renewal.  Plus, Allstate will not drop you just because you have a claim. After being robbed, I am kicking myself for not changing our policy before now.

Now, if you are still reading this, thank you. Please, please make sure you go over your policy and KNOW WHAT YOU HAVE. When it comes time to use it, it’ll be too late. You are stuck with whatever you picked.

Now, I think it’s even more important to make sure you have enough AUTO coverage. You are more likely to use your Auto insurance than your home.

Your Auto Policy has 3 key coverages : The other person, You, and your Car.

Other person

If you were driving home last night, and you killed someone in an accident, how much do you think they’d sue you for? All they can get, right? If your liability limits on your policy were 25/50 (TN State Minimum) Your insurance company would write a check for $25,000 and you would be stuck paying the rest. Attorneys can go after the equity in your home, take any savings and/or investments you have, they can even garnish your wages up to 25% . This is why its so important to make sure you have the right coverage.

YOU

Ok, let’s turn that accident around and say you were the one killed in that accident last night? How much do you think your family would need to replace your income, or at least be able to live like they did while you were here? If the accident was the other person’s fault, and the were uninsured or underinsured, your family would get $25,000.00. That’s it. Unless of course you have any life insurance policies.  This is another reason why its so important to make sure your coverage is adequate for you and your family

Car

Of course, your car insurance covers your car. Let’s say your deductibles for Comp and Collision were $500/$500. This means if you were driving down the road, you look down to change your radio and you hit a tree, that would be covered under your collision. You would be responsible for the first $500 to fix your car. If there was a lightning storm and that tree fell and hit your car, that would be covered under comprehensive (things out of your control - rocks hits your windshield, deer runs out in front of you etc.)  You would still be responsible for the first $500.  I personally think your comp should br $0. If a rock hits your windshield, its going to cost only probably $300 to fix it, so you’d never get to use this part of your policy. And Comp claims do not count against you at Allstate. So why not ?

Your options at Allstate are the same two packages, Platinum and Gold.

Platinum Package

Safe Driving Bonus -  I’m sure you’ve seen this on tv. For every 6 months you do not have wreck, you will get up to 5% back in the form of a check, sent to your house.

Accident Forgiveness-  Your rates will not go up because of an accident (for multiple accidents)

Deductibe Rewards-  I think this is pretty cool. For every year you do not have an accident, you will get $100 off your collision deductible. (up to $500) So if you go 5 years, your deductible could very well be $0.

Ok, that’s my spill. I hope this helps you better understand your policy. If you have questions, please let me know. I’d be more than happy to go over it with you. If you are interested in Allstate, let me run you a quote. If it’s cheaper, AWESOME! If not, that’s okay too. I’m not going to push you into buying something that’s more expensive (as long as your coverages are okay for you and your family) (go to www.allstate.com for more info)