While you can expect an insurance agency to care a lot about the details of insurance, chances are, you don't want to spend much of your time thinking about it. Chances are you have a family to provide and care for, a job to perform or a business to grow, and/or many other things to occupy your time.
Unfortunately, too many Texans are educated the hard way about insurance, AFTER something goes wrong. This is not a good time to find out you didn't have adequate coverage to repair and/or replace a roof or extensive water damage. It's also not a good time to find out you'll pay a lot more out of pocket than you'd like, even if you did sign the papers.
Mistake #1: Not Enough Dwelling Coverage to Rebuild
Let's face it, a catastrophe causing you to have to rebuild your home is stressful enough without having to navigate around not having enough funding to do so. Whether it is a tornado, a fire, or a tornado full of fire or an equivalent nightmare that completely demolished your home, you don't want to hear from your insurance carrier that replacing your home won't go as expected.
The calculation of how much dwelling coverage before the catastrophe is key. When life gets turned upside down in a big way, you want to know you have some "normal" to look forward to. Just knowing you'll be able to rebuild your home while you rebuild your life, possessions, and memories is part of why home insurance exists.
Mistake #2: Your Deductible for Wind and Hail is Higher than 1%
Knowing your homeowner's insurance policy has a dwelling amount defined to help determine what you'll need to rebuild, it also helps in determining the wind and hail deductible you pay for those common claims.
This exists in the form of a percentage of the dwelling amount. For instance, if your policy has a 1% dwelling amount, which is highly common, and the dwelling amount on your policy is $350,000, then you would expect to pay $3,500 out-of-pocket for repairs or replacement with your insurance carrier covering the balance in most cases.
With that said, a percentage point makes a difference. Some homeowners decide they are willing to live with the though of paying a higher deductible and less cash paid out monthly to cover their premium payment.
Beware. What may seem like a minor difference, say a 2% deductible versus a 1% deductible, could cost you a lot more than you bargained for. Instead of paying $3,500 in the scenario above, your carrier would expect you to cover $7,000 of the repair expense.
A small change meant to ease the hit to the wallet can have a larger detrimental impact when (not if) that giant hailstorm pounds the roofs in North Texas or the hurricane force winds send roofing tiles flying along the Gulf.
Mistake #3: Your Coverage for Water Damage is Too Limited
While wind and hail claims are prominent in Texas, we also see a lot of claims for water damage. It's important to know what is covered since water damage can occur in many different forms.
If water damage comes from the outside in, say rising water from a flood, you'll need to have a policy covering that specific event.
Usually on a stand home policy, or what we call within the industry and H03, sudden discharge of water or steam is treated as a covered event.
Think of these events along the lines of pipes bursting, exploding water heaters, or dishwashers that decide to burst their seals and leak out.
What is not sudden discharge? Think a slow leak over time, say from a drip pan below the attic air conditioning unit that suddenly shows up as a wet spot on your ceiling. This would most likely not be a covered event, since it happened slowly over time.
How to Avoid Those Mistakes
As the G.I. Joe animated series used to tell us, "Knowing is half the battle." We're all about education here at Insurance For Texans. As an independent insurance agency, we've take a lot of time to educate ourselves on why insurance doesn't have to be one-size-fits-all, because in reality, it doesn't.
We are a unique state with unique regions and cities with unique people getting more unique every day. Chances are your needs in Dallas aren't the exact needs of your friend in Austin or Houston.
While we do know mentioning insurance and mistakes does grab the attention, we don't list them for attention-sake. If you have no idea whether you have adequate coverage, that's a problem.
Insurance is meant to help and not hurt and with our ability to access a marketplace full of options, there's no reason you should have inadequate coverage.
Give us a call or text and we'll talk it over.
Whether you've been here in Texas for awhile or are new to the state you should know . . . Texans help Texans.
That keeps our state great. And when it comes to insuring you and those you love, that is our goal.