Home insurance is something that you should never take lightly. In a disaster, you will be glad you have it. But what are your options for home insurance? There are three levels of homeowner’s coverage—actual cash value, replacement cost, and guaranteed value. Here’s a breakdown of your options.
Actual Cash Value
Actual cash value is the most common type of home insurance. It pays to repair or replace your residence with what it was worth, minus depreciation. For example, if your home was worth $200,000 when you bought it, but it’s only worth $150,000 now, your policy would only pay $150,000 to repair or rebuild it.
The actual cash value coverage also includes lost and damaged belongings. Check the individual policy for limits on certain items, such as jewelry, collectibles, and electronics.
This type of policy pays to rebuild your home with new materials, no matter the current market value. So, if a fire destroys your home and it would cost $225,000 to rebuild, that’s what your policy would cover.
Replacement cost policies also include lost and damaged belongings, but with a higher limit than actual cash value policies. Your Acme Insurance brokerage agent in Amityville, NY can help you find the right replacement cost policy and advise you of any limitations to the coverage.
Guaranteed value is a long-term policy that ensures coverage includes reconstructing your house to its original specs, regardless of the current market price. So, if a fire destroys your home and it would cost $225,000 to rebuild, that’s what your policy would cover.
The coverage includes your belongings, too. However, it’s also essential to know that these policies often have a maximum payout limit.
Talk to your Acme Insurance brokerage agent about your options if you’re looking for home insurance in Amityville, NY.