Most homeowners usually say it’s better to overpay insurance rather than underpay. At S & S Insurance Services Inc., we typically say that purchasing the right insurance is the best thing for your finances. While overpaying is much better than underpaying, buying too much insurance isn’t the best way to use your finances. With that in mind, let’s see the amount of home insurance sufficient for you.
Meet the lender requirements
The first step in ensuring you have enough home insurance is complying with the lender requirements. If you have a mortgage, the lender will want you to maintain insurance equivalent to or more than the mortgage balance. While meeting the lender requirements is fine, this shouldn’t be the only guide for the amount of coverage you need.
The amount of dwelling coverage needed.
How much can you afford to pay out-of-pocket when repairing or rebuilding your home? That should be your deductible. Now, regarding insuring your home, always opt for the “replacement cost value” instead of the “ actual cash value.” The replacement cost value ensures that you get the full value of your home were it to be built from scratch today. This means you incur little out-of-pocket costs if your building was totaled today.
What about liability coverage?
This is usually tricky because you never know the magnitude and time of the liability claims you will face. We typically advise homeowners to consider liability coverage between $300,000 and $500,000. However, if you are a high-net-worth individual, we recommend considering umbrella insurance or excess liability coverage.
Home insurance in Oklahoma City, OK.
Since we know figuring out your home insurance needs on your own can be challenging, we would like to partner with you to help you navigate the insurance world. Please contact S & S Insurance Services Inc. for more information. You can visit our Oklahoma City, OK offices to chat with one of our agents in person.