If your home is completely destroyed and unlivable, your homeowners policy has a loss of use or additional living expense policy which allows you to maintain your standard of living while dealing with this loss. This means if you are used to living in a Mansion, your insurance will cover you renting something comparable in the interim. This policy will also cover laundry service, meals, etc. The key to getting the most out of this policy though is to keep detailed records and receipts of your expenditures.
So that takes care of your immediate needs, but what happens with your mortgage. Lets say you have a home valued at $300,000 with a mortgage of $150,000. This is covered under your dwelling coverage policy. When you first purchased homeowners insurance your home was valued at a certain amount, this amount is the replacement value of your home. There are a couple of caveats to this policy, but whats important to know is that the bank gets paid first. Whats left goes to you. This is what you use to rebuild your home or to buy something new. Some policies even include covering closing costs or an allowance for a monthly stipend to cover an increase in interest rate.
All of this coverage and we still havent gotten to how you replace all of your stuff. Personal property coverage is what will help you pay for a new couch, kitchen appliances, and shoes. You gotta have shoes. So how does personal property coverage work Its usually a percentage of your dwelling amount. If your home is valued at $300,000 and you have 50% personal property coverage youll get $150,000 to replace everything. Your policy may also be broken out into replacement cost or cash value. Replacement cost means if you bought your couch for $1,000 10 years ago youll still get $1,000 to replace it today. Cash value means youll only get 100 bucks because thats all your 10 year old couch is worth today. Your best bet for the smoothest possible transition after a disaster is to have a comprehensive inventory of all your belongings. You can hire a company to do this for you or you can do it yourself. Either way, once documented, the information needs to be held in a safe location somewhere other than your own home.
While all this is good information none of it matters if you dont investigate your own policy. Understanding what coverage you have, and what you can expect in the event of the unthinkable, is invaluable. Take this as a nudge to call your agent today. Increasing your coverage to where you feel comfortable may cause you to spend a little more per month, but knowing youll be taken care of in a tough situation is probably worth it. Thats for you and your agent to decide.
AFFIDAVIT OF SURVIVORSHIP affidavit of title BUYERS commercial real estate COMMON LAW MARRIAGE COVID AND EVICITION DEATH AND REAL ESTATE Deed estate planning estate planning real estate trends FSBO future of commercial real estate Future of real estate home buying Home seller home selling inheritance KC real estate LANDLORD Landlords land use midwest real estate PROBATE Property Management real estate closing real estate contracts real estate deeds Real estate deed work real estate ethics real estate finance Real estate financing real estate investing real estate lawyer real estate management real estate market real estate markets real estate planning real estate transactions real estate trends seller financing SELLERS SURVIVORSHIP AFFIDAVIT TENANTS IN COMMON TRANSFER ON DEATH DEED wholesale real estate
- Accredited Investor Verification Letter
- Areas of Practice
- Brokerage Services
- Buy Real Estate Form Templates
- Flat Fee Legal Protection for Buyers and Sellers of Real Estate
- FSBO Lawyer in Kansas City
- FSBO-OWNER FINANCING
- General Disputes
- Glossary of Terms
- Investor List
- Investor Services
- Kansas City Real Estate Lawyer in Missouri – Book same-day, online document reviews for transfer of beneficiary & quit claim deeds, marital waivers, commercial & residential contracts, Investments & more.
- Kansas Legal Resources
- Kansas Resources
- Legal Services
- LIFE ESTATE DEED
- Missouri Legal Resources
- MISSOURI REAL ESTATE TAX ASSESSMENT APPEALS
- Missouri Resources
- MLS Commission Rates
- My Account
- My account
- My Cabinet
- Our Firm
- Real Estate Tax Sales Overages in Missouri
- Same Day Production
- Seller Agent
- Seller Financed Instruments
- Short Sale
- THE SANDWICH GENERATION
- Title Insurance
- WHAT IS AN EASEMENT?
- What Makes Us Different
- Who we Represent
- Jackson County Missouri Ordinance Classifying Source of Income as a Protected Trait
- ASSISTANCE/SERVICE ANIMAL AS AN EXCEPTION TO LANDLORD PET POLICY BASED ON FAIR HOUSING ACT
- KANSAS REAL ESTATE TAX APPEAL
- KANSAS TAX FORECLOSURE AUCTIONS
- TAX SALES AND TAX OVERAGES IN MISSOURI