Insurance That Fits Your Needs

Because an insurance policy is a legal document, its language is sometimes hard to understand. As a service to our clients we are pleased to provide this explanation, in layman’s terms, of “All Risks” house insurance. This guide covers only the highlights of this policy and does not pretend to explain each and every condition, nor does it override or alter any policy wordings.

Nevertheless, we hope you will find it useful in understanding the coverages it provides; the amounts of protection available; the hazards protected against; and the deductibles that apply.

Limits
A Homeowner's policy provides a variety of coverages in the following amounts:

Cumulative Limit (Single Limit)
This is a single total policy limit which allows you to allocate the coverage limits for your home, outbuildings, household and personal effects and additional living expenses. Why is this beneficial? Normally the limit of insurance you can draw upon for claims involving your outbuildings, personal effects, additional living expenses is a predetermined percentage of the amount of insurance applied to your house. These percentages aren’t always appropriate for you particular circumstances and the Single Limit allows you more flexibility. Most insurance companies can provide this option.

The Home Itself (The Building)
This indicates the total limit of insurance available for damage to the actual house structure, excluding debris removal.

Outbuildings, If Any (Shed, Carport, Garage, Etc.) Detached
This indicates the total limit of insurance available for damage to your outbuildings. The limit deserves an extra look if you have outbuildings which have been built or renovated to provide a home office or work centre. If this is the cast you might want to look at a Cumulative Limit type coverage.

Household And Personal Effects Located Within The Home
This pays for such things as damage to your appliances as a result of lightning, burns to your rug from a smoldering log which has fallen out of the fire place. In other words this limit is available to respond to damage to your possessions (household and personal effects).

Household And Personal Effects Temporarily Removed From The Home
This pays for such things as the theft of an overcoat from a restaurant or your place of employment, your child’s bicycle that was stolen at school, your personal effects that were stolen or burned while you were staying in a hotel, etc. In short, anywhere at all other than your premises.

Additional Living Expenses
This pays for any additional expenses that you have to incur if you are forced to vacate your home as a result of any hazard cited below. (While the house is being rebuilt or repaired, your family expenses will increase as a result of hotel or motel accommodation, restaurant meals, etc.)

Personal Liability Coverage
This pays for liability which you might incur as a result of (1) people who injure themselves on your premises; (2) people to whom you or family might cause injury, either on or away from the premises; (3) the property of others that may be damaged by you or a member of you family. (Remember that this category pays for injuries or damage to the person or property of others, for which you or your family or your household pets are to blame; it does not pay for your own property or your own family members.)

So far we have described the coverage amounts provided. Your policy then agrees to cover loss or damage to your property mentioned above caused by “All Risks of Physical Loss or Damage”. This is the broadest basis on which coverage can be purchased, HOWEVER, there are some causes of loss which are specifically excluded such as earthquake, flood, rodents, vermin, gradual deterioration plus others and the policy wording should be consulted for complete details.

Deductible
Small claims cost Insurance Companies a great deal in both time and money. In order to reduce costs most policies have a deductible clause which provides for the customer to pay the first few hundred dollars of any loss. The higher your deductible, the lower your premium will be.

General Items of Information

1.	The cost of replacing household and personal effects and rebuilding homes is steadily increasing. You should review your amounts of coverage every year or two to make sure they are still sufficient. If higher limits are needed, or if you make additions to your house or outbuildings, please let us know.
2.	Watercraft: a) If you own a boat in excess of 26 ft. and a motor in excess of 16 h.p., any liability resulting from their operation is NOT covered unless specifically indicated on the policy:b) All risk coverage on the boat and motor is NOT provided, unless specifically indicated on the policy.
3.	Valuable Articles : This policy provides coverage (for the perils already stated) to the combined value of $6,000 on items of jewelry, watches, and furs: $10,000 on silverware, gold ware or pewter. If more coverage is required, or if you wish such items to be covered on an all risk form of protection, please advise us. (All risk protection not only covers against perils such as fire and theft, but could be of value in claims arising from breakage, staining, loss, mysterious disappearance – such as a precious stone falling out of a ring, and so on. In short – All Risks. Valuable items should definitely be insured on this basis (i.e. high value cameras, fur, jewelry, object of art, etc.)Your policy also provides other limited amounts of coverage on the following items: $1,000 on money: $6,000 on securities:$5,000 on coin collections; $5,000 on stamp collections;$4,000 on boats and motors. (Once again, only for the perils listed.)
4.	If you own another residence – such as a summer cottage – your liability coverage can be extended to cover the additional property for little more than a few dollars a year. Please advise us if this is the case.
5.	If for any reason your home is left vacant (where all furnishing and personal effects are removed), be sure to let us know. Coverage under your policy automatically ceases 30 days after the date of vacancy.
6.	If you leave personal possessions in an automobile, be sure to lock it. If such items are stolen a claim can only be made if the car bears signs of forcible entry.
7.	If you conduct a business from your home, be sure to let us know so that your policy can be endorsed to protect your interests and your liability.
8.	If you have a swimming pool on your property that can be filled to a depth of more than 30 inches, let us know so that liability coverage can be extended to cover bodily injury or death that may occur in the pool.
9.	In the settlement of any claim on household or personal effects, depreciation (due to age and use) would be taken into account. Depreciation is not considered in claims on buildings, provided that the amount of coverage in your policy is at least 80% of the rebuilding cost. (In your own interest you should, of course, cover your home for 100% of its rebuilding cost.)
10.	Replacement cost means that damage to insured property is settled without deduction for depreciation, when the property is replaced with comparable quality and usefulness.
11.	If a member of your family lives away from home – a child at university, for instance – let us know so that your policy can be extended to cover both liability and personal effects at the other location.
12.	If you plan to be away from home for more than 4 consecutive days during the “heating” seasons, there is a clause in your policy requiring that your home be entered daily by a competent person to ensure the heating system is operating properly. (This requirement relates to the “bursting of plumbing” hazard and “any damage that may arise there from” for which you are protected.) Better still, shut off the water supply, drain the system and turn off your electric water heater. If you do this, there is no requirement to have the house visited daily.
13.	If more than one location is insured under this policy; the description of coverage pertains only to the main residence.
We hope that this brief description has given you a good idea of the kind of coverage afforded under your policy. (It should be clearly understood that this is nothing more than a descriptive brochure. The only document that accurately reflects the precise definition of your coverage is the policy itself.) If after reading this you have any questions or wish to make any policy changes please telephone or drop into our office and we will be happy to talk it over with you. Let one of our highly trained professionals assess your needs. Call your local Crain & Schooley office today.