By Jennifer Tudor

It’s that dreaded nine-letter word—insurance. We’ve all got it, in fact, some of us have lots of it and it’s one of life’s “necessary evils”. But how many people truly understand the policies that we pay for year in and year out? Let’s take a look at the basic homeowners policy. For most, our homes are our largest assets and as such we want to protect them. Your homeowners insurance policy then should be set up to protect that prized asset, and prevent financial loss to you, the homeowner. But what does that really mean? Have you ever tried to navigate your way through your policy in hopes of better understanding exactly what is covered and what you are shelling out all of this money for? If you have, you’ve probably given up about halfway through the first page. Today, let’s take a moment to examine the basics. 
First, your policy is set up to protect the structure itself which is outlined under the “dwelling” portion of your policy. Remember this value reflects the amount to which it would cost to replace the existing structure. Items such as land value, lot premium, and/or purchase price are not good indications of what should be evaluated when calculating this value. In addition, this will cover any other items physically attached to the home, such as a pool. While we are addressing pools under the property coverage portion, another important item to consider is the pool cage. Many carriers insure the pool cage only by endorsement (an add-on to your basic policy) and some will not offer coverage to this item at all. As damage to or loss of a pool cage structure is extremely high in the event of a hurricane, be sure to check your policy to verify that it includes this valuable coverage. 
The next coverage, which may or may not apply is your “other structures” coverage. This item is set up to protect any structures that are not physically attached to the main structure—detached garages, fencing, workshops, or a shed. Many carriers will include this coverage as an automatic percentage of the dwelling coverage, generally 2-10%.
Another item to review carefully is your personal property coverage. This will cover the loss of any personal belongings, furniture, and electronics. For this item, there are two types of loss settlements- replacement cost and actual cash value. With the actual cash value option, your belongings are covered for their current replacement cost minus depreciation. Depreciation will be determined as the total decrease in value of an item due to its age, condition and other contributing factors. The second and most common type of loss settlement is replacement cost. In this case, your belongings are covered for the amount that it would cost to replace that same item at the time of the loss. For this reason, the replacement cost coverage does carry a higher premium. In addition to considering the type of loss settlement, you will want to also consider the actual items you are insuring, and whether your policy is adequately covering those items-especially in the event of a loss due to theft. Did you know that most policies have a maximum amount that they will pay out on items like jewelry, fine arts, furs, and firearms, which generally maxes out at around $2,500? For items of value, it is important to consider scheduling those items onto a personal articles floater to ensure financial protection.
In the event that you are unable to live in your home due to a covered loss, your homeowner’s policy will also afford coverage for such a situation through the “loss of use” coverage portion of your policy. This item is generally a pre-set amount determined as a set percentage of your dwelling coverage. 

Yet another important coverage included under your homeowners insurance package is your liability coverage, which will generally include a separate limitation for medical payments. These items are set up to directly protect you and your family’s assets in the event that someone sues you for damages incurred on your property, or as a direct result of a member of your immediate household. Keep in mind that most policies will have either separate exclusions or endorsement requirements for animals (even household pets) as well as trampolines, watercraft, ATVs and pool slides/diving boards. Be sure to consult with your agent if you feel that any of these exclusions could result in a gap in coverage. 
As you probably know, in the event of a loss there will still be some financial obligation that remains on your shoulders, prior to any payment being made by your insurance carrier. These amounts are of course known as your “deductible”. For this reason, it is important to choose a deductible that fits your financial comfort level. Policies including wind will have two separate deductibles. Your first deductible, known as your “all peril” deductible will be a fixed amount (ie. $1,000, $2,500). This deductible will apply to any covered losses other than a “named storm”. Your second deductible will be your hurricane deductible, which for many years was required to be a set percentage of your dwelling coverage (typically 2, 5, or 10%), however there are many carriers that now offer either a diminishing or flat hurricane deductible, which can significantly reduce your out of pocket obligation. You will note that of course, there is a direct relationship between the deductibles you select, and your total premium—the higher deductible option selected, the more you can expect to reduce your total premium, and vise versa. 
On that note—flood insurance, flood insurance, flood insurance! Time and time again, I explain coverage to my clients and I get the same response—”right, but if we have a hurricane, and we get so much rain that it causes water to rise into my property, my homeowners policy will still cover that, right?” —Wrong. Unless you have purchased by separate endorsement, your homeowner’s insurance policy specifically excludes such coverage. Any rising water, as an act of God, is covered only under a flood policy. For more information, I encourage you to visit floodsmart.gov which is an excellent resource for homeowners interested in evaluating their potential risk.
The last thing to consider is your availability of credits. From the roof that you recently replaced, to the security system that was just installed, or the guard that greets you in your community, there are all kinds of credits available to homeowners in our area, so make sure that you currently receiving any and all credits that you may be eligible for. In addition, if you have not had a wind mitigation inspection completed on your home, and it was built prior to 2002, you are potentially missing out on 30-40% in premium reductions based on items ranging from the shape of your roof to the way your roof deck is attached. Consult with your agent to make sure that you are maximizing your savings! 

Founded in 2000, Gulf Coast Insurance, LLC, is a leader in providing quality protection for hundreds of individuals, families, and businesses throughout southwest Florida. Superior customer service and low rates along with our ability to understand our customer’s coverage needs drives the success of our agency. By offering world class protection for your auto, home, flood damage, business, and life insurance, we make sure that you’re covered today as well as in the future, so that you can focus on what’s important to you and your family. At Gulf Coast Insurance, LLC, our #1 job is to assist you in identifying your needs and problems while putting together a customized plan that’s simple and easy to understand.

239.403.3940 | 7795 Davis Blvd Suite 205 Naples, FL 34104 | info@gcimail.com | gulfcoastinsurance.com