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Ask Cora
Hey Cora, with Florida having a homeowners insurance crisis right now, do you think my homeowner’s insurance will increase here in Alaska?
Let’s face it... insurance is pretty boring! I mean really, the only thing fun about insurance is their commercials! Geico, State Farm and even Farmers insurance have done a pretty good job with their advertisements of late. But as boring and uninteresting as it might be, it is something that we need to talk about. Let’s ask some tough questions: Will prices on your home go up because of the hurricanes in Florida and the Carolinas?
Everything is going up and because labor and materials are so much more expensive now, it’s a definite possibility. Insurance companies are companies that need to make money like any other company. As much as we say we don’t like insurance companies, they are still necessary in our lives. I am sure we will see increases in homeowner’s insurance; do I know that for sure – nope!
Does homeowner insurance cover wildfire damage?
Yes, most do. A homeowner’s insurance policy will cover damage from fire, including wildfire. If your house is damaged by a fire, the policy has several coverage types to help repair or rebuild the home, replace belongings and, if necessary, pay for temporary housing if you can’t live in the home.
Dwelling coverage pays to rebuild or replace the physical structure of the home and attached structures, like a deck or garage. You’ll be covered up to the policy limits, which is typically based on the amount it would cost to rebuild the entire house, based on materials and local labor costs.
If you haven’t recently reviewed your homeowners insurance policy or you’re not sure how much home insurance you need, now is a good
time to take a look at it. That’s because you want your dwelling coverage to keep pace over time with the changing costs to rebuild the house.
“Other structures” are items not attached to your house, such as a detached garage, shed or fence. This coverage type is often based on a percentage of your dwelling coverage. For example, your coverage for other structures might be set at 10% of your dwelling coverage. If you have $250,000 in dwelling coverage, you will have a $25,000 limit for other structures. Other structures include barns, sheds, storage areas, even a small house on the property may not be fully covered for its value. Review your policy (I know – Boring!) and make sure that other structures are covered. We have an insurance agent, call them and review your policy with them, this will help you determine if you need more insurance or not.
Your personal belongings, such as furniture, kitchen appliances, electronics and clothes, fall under this coverage. Policy limits are usually set between 50% to 70% of your dwelling coverage. For example, if you had $250,000 in dwelling coverage and your personal property coverage is set at 50%, you would have $125,000 for your belongings.
A good way to determine if you have enough personal property coverage is by making a home inventory. Basically, list all your stuff and how much it would cost to replace it if your home was destroyed by a fire. You can buy more personal property coverage if your current insurance limits
are too low. So, you may need a rider policy on say antique guns, or jewelry, furs. Also remember, your vehicles are not covered under your homeowner’s insurance policy. They are covered under their car insurance policy. So, if you have a classic car in the garage that you are restoring, if you don’t have separate coverage on that car, it will not be covered if your home catches on fire.
You can also increase this limit if you want to. Just remember, every time you increase your limits, your price goes up – it might be worth it to you.
What about floods?
Flood is a different thing, you need to specifically have flood insurance. Make sure you speak to your insurance agent about this – it’s very specific. Will there be areas that cannot get fire insurance?
Well that’s always a possibility. Right now, it’s difficult to get insurance in the Big Lake area that has no road access. In fact, many insurance companies will not insure without a road and with almost over 1/2 of the Big Lake and connecting lakes on Big Lake not having road access, this makes finding insurance a challenge. So, the ability to get insurance could mean the difference of being able to finance a cabin or not. And if you paid cash, you may not be able to insure your investment.
Magical Unicorns!
Your insurance agent is like your own personal magical unicorn in that they can understand the legal-eez in an insurance policy, and if they don’t; they have someone who does! So, call them Ask your questions now before you need them. A talk with your magical unicorn today could save you $1000s of dollars tomorrow!
Remember, if you know someone buying or selling real estate, give me a call, I would love to help.
Kids! Send in your coloring contest entry for a chance to win an 8” cake from Dairy Queen! One winner from each age group 4-6, 7-9 and 10-12 will be announced in the January 2025 Greatlander.
Parents - Please help your child legibly write their name. Use crayons, pencils or markers. Please NO GLITTER. Submissions must be received by December 27th, 2024. Mail entries to: GreatLander, 3110 Spenard
