Years ago, I briefly lived in the San Fernando Valley and my home was burglarized.  Prior to the burglary, I had contacted my insurance company, asked some questions and then switched carriers.  Fortunately, I had checked my coverage, (mostly related to antiques, and replacement value of household contents) and switched companies prior to the break in.

Last Week’s Mortgage Facts from Floyd Walters, owner of BWA Mortgage are especially timely:

Fact #1:  How do you know if you have enough homeowner's insurance coverage?  The real answer for most of us is "we don't know".  We assume we are taken care of but the only real way to know is to take the time to sit down with your insurance professional and go over your coverage, in detail, so you know exactly what you are covered for and just as importantly what you are not covered for.

Fact #2:  Is there a formula that can at least get me in the ballpark of the dwelling coverage I should have so when I talk with my agent it makes sense?  Well, I am not an insurance professional but a formula I use for myself is as follows: 

"Multiply the square footage of your home

__(a)__ by the square footage cost of replacing your home __(b)__  (I used $240 per square foot but have been told that is probably not enough) and the result is the amount of basic coverage you will want to consider".

Fact #3:  Once you have completed your review get your policy out and call your agent today.  Let them know you would like to sit with them for 30 minutes and go over your policy in detail.  If you can't meet in person at least go over the coverage with them over the phone until you understand your options and have the coverage you need.

 

I spoke to a contractor friend who advised me that the range for replacement cost is between $250 - $350.  Contact your insurance company today and verify your coverage.  If you live near the hills, you should also ask if you will be covered for mudslides, mud damage, flooding etc.  We are anticipating a moderate El Nino this winter.