A home’s sale price, its rebuilding cost, and the value of your belongings answer different questions.
Understand how a loss is valued
Rebuilding cost is not your home’s market value, which includes land and reflects the real estate market. Replacement-cost coverage and actual-cash-value coverage are also different: actual cash value takes depreciation into account. Ask how these terms apply to the building, roof, and belongings. Payments remain subject to the policy’s terms, limits, and deductible.
NAIC · Actual cash value and replacement costRenting does not make belongings the landlord’s responsibility
Your landlord’s insurance does not cover your personal belongings. Renters insurance can include protection for belongings, personal liability, and additional living expenses after a covered loss. Ask about limits for valuable items and how possessions are valued.
NAIC · Protecting your belongings as a renterDon’t treat all water damage as the same
Most home and renters policies exclude flood damage. Separate flood coverage may be needed for your building and belongings. Ask about flood, water backup, and other water losses separately; one form of protection does not stand in for all the others.
FEMA / NFIP · Flood insurance coverage and exclusionsMake the next review concrete
An inventory of your belongings and a list of renovations give the conversation a useful starting point. Review dwelling limits, deductibles, exclusions, and added coverages—not just the premium at renewal.
NAIC · Shopping for homeowners insuranceTAKE THESE TO YOUR AGENT
Three questions to start with.
- How would this policy value my roof and belongings?
- What is excluded, and what can be added?
- What does my deductible mean in dollars?
Sponsored by Grant Rosandick. Use these questions with any licensed agent. Public sources are provided for further reading; they do not endorse this guide or its sponsor.