Buying a house may be the biggest investment you will ever make. Once you move in, the house isn’t just a house anymore; it’s a HOME! Protecting your home and its contents is crucial because large losses can cause financial wreckage. Insurance protection is a broad topic and can be confusing, leaving you wondering just how much insurance protection is necessary. Find out what you should know about your homeowners insurance limits and how it applies to your home and it’s contents.

What is a Policy Limit?

The amount of coverage you have acquired under your standard N.C. homeowners policy is referred to as policy limit or limit of coverage. This is the maximum amount your insurance company will pay for a particular loss/losses. Keep in mind that each homeowners policy is unique, just like your home, so the policy limits must be carefully chosen to reflect accurate values.

N.C. Homeowners Insurance LimitsProperty Coverage

One section of coverage under your N.C. homeowners policy is referred to as Property Coverage, which includes your home, personal property and other structures on your property. Most policies assign different limits for each of these.

For property coverage, most people look at market value of their home when choosing the limits of coverage. Market value is what that particular home would sell for in the market now. However, the best option is to go with replacement cost of your home. To determine what it would cost to rebuild your home (replacement cost), your N.C. independent insurance agent is there for you. He/she may utilize replacement cost estimators to determine values of replacement cost.

Other Structures and Personal Property Coverage

Most standard N.C. homeowners policies will use a % of the coverage you have on your home to determine coverage limits under these particular sections. For example, let’s say you, with the help of your independent insurance agent, have established a value of $200,000 for replacement cost for your home. If your homeowners policy has 10% provided for other structures on your property, there would be $20,000 available for coverage under other structures on your property.

Keep in mind that if you deem this value to be inadequate, you can work with your N.C. independent insurance agent to determine an amount that would be more appropriate to cover the value of other structures and personal possessions.

Personal Property Coverage

When determining the value of your personal possessions, you may be surprised how much stuff you actually have. It is best to do the following in order to determine whether your insurance coverage amounts are sufficient:

  • Keep a list of personal property with details of make, model, and price paid
  • Take photos of your personal belongings
  • Store this information online or somewhere away from your home in a safe location

*Special limits may apply under the personal property section of your N.C. homeowners policy. Contact your independent agent for details.

Personal Liability Coverage

If you are found legally responsible for causing injury or damages to somebody else, you will have to pay for the damages you cause; however, with N.C. homeowners insurance, you will be covered under this portion up to a certain acquired limit of liability. Most standard N.C. homeowners insurance policies categorize bodily injury and property damage together under personal liability. This coverage pays for personal liability for damages/injuries caused by you or any family member living with you, up to the limit of liability chosen. Your N.C. independent insurance agent can assist you in determining the amount of coverage that is best for you.

Your Independent Insurance Agent is Happy to Help!

Understanding your homeowners insurance policy and the limits of coverage is better said than done. Your N.C. independent insurance agent is here to help you understand so that you can make the right choices to protect your HOME and all that goes in it!

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