How Much Home Insurance Is Enough?


A & M Insurance® understands the home insurance needs of our customers and potential customers living in Washington state. We’ll work with you to accurately estimate the replacement value of your home insurance and to adjust your policy limits from time to time as needed whether you are our neighbors living near us in Renton, Washington or somewhere else in Washington, Oregon, or Arizona.

The cost to rebuild your home is its replacement valueThis can be very different from the estimated market value or actual purchase price of your home.  In most cases, it costs more to rebuild the house you own than to buy a new one.

It is extremely important for your peace of mind and for the insurance to adequately meet your needs after a loss that you provide us with accurate, up-to-date information about your house and contents now. If your homeowners insurance accurately reflects your home’s true replacement cost, most companies include an extended coverage shield so that they will pay more than the stated dwelling limit if a covered damages exceed the limit on your policy. We recommend you check with your home insurance agent about your home policy coverage now BEFORE a claim occurs.

Once a review of your home insurance and your personal belongings indicates you are properly insured, it’s a good idea to re-examine your coverages and limits from time to time. It is especially important to do this whenever you make additions or improvements to your home or property.

 Be Sure You Have Enough Homeowners Insurance

Here are some steps you can take to reduce the danger of being seriously underinsured or paying too much for unnecessary coverage:

  1. Call A & M Insurance Services, Inc.  If you have questions or concerns about the limits in your policy speak with one of our knowledgeable agents at 425-228-7406. Ask us to show you how those amounts were calculated. This will also give you an opportunity to make us aware of any information that might have been overlooked.
  2. Read your policy. Certain property, such as jewelry, and certain perils, such as earthquake or flood, are better insured separately. Knowing what is covered and for how much will help you insure properly. If there is anything in your policy you don’t understand, contact A & M Insurance Services, Inc. at 425-228-7406 and ask for an explanation.
  3. Review. At each annual renewal of your Renton homeowners insurance policy, you receive a new policy declarations page showing limits of coverage and optional coverages. Review this information. If you do any significant remodeling or add a family room, extra bedroom or bathroom, etc., tell us about these changes so your coverage limits can be adjusted to properly cover the improvement.
  4. Consider. Carefully consider whether your home insurance provides all the protection you want or need. Does your home insurance provide Ordinance or Law coverage that covers the extra costs resulting from building code changes? Does it automatically increase coverage limits annually to keep pace with inflation? Does your homeowners insurance give you additional funds if the cost of rebuilding your home exceeds your policy limits?

Make sure you know:

  • Will your insurance company stand behind agreed upon repairs after a claim? Some companies put this guarantee in writing.
  • Does your Renton homeowners insurance policy include replacement cost coverage for contents (clothing, furniture, appliances, and other personal belongings inside your home)? If not, you can add it by endorsement. The cost is small, the protection is invaluable. Replacement Cost Coverage pays for losses to your chattel at the cost of brand new items. Without this option, a covered loss to your personal possessions would be depreciated by their age and condition, reducing the size of your claim settlement dramatically.

If you have an art collection, antique furniture, jewelry, or other valuable possessions, talk to your agent about supplemental coverage, such as fine arts or scheduled property endorsements, to make sure you are adequately protecting your investment in these items. The cost is modest for the extra protection, and often your deductible is waived.

Consider whether you should have more coverage for personal property (contents) than your policy provides. Personal property coverage is usually 70% to 75% of the coverage limit for the structure. Your limit may be lower than 70%. Supplemental protection from your homeowners insurance carrier may be available for a small additional premium.

Inventory your home. Prepare an inventory of personal property items, update it periodically, and keep it in a safe place outside your home, such as a safe deposit box at your bank. It will save you hours of time trying to list everything damaged or destroyed if you need to make a claim. It will also help ensure you don’t forget some items. A & M Insurance Services® can advise you on ways to simplify the job of preparing a personal property inventory such as videotaping each room with descriptive information on the sound track, or using an iphone app or  android phone app.

Personal Liability

Besides making sure you have enough protection to cover possible damage to your own home and contents, you should also evaluate your exposure to liability risks. These result from damage to the property of another, or injury to a person, not a member of your household, for which you can be responsible.

In recent years it’s become common for homeowners to be sued for injuries or damages to others, even when there is no evidence of negligence by the homeowner. The reality today is if you have any appreciable assets, you are exposed to the risk of being sued. Even if you ultimately prevail in court, your legal fees and the months or years of worry and uncertainty can be a terrible burden on you and your family.

The Personal Liability coverage provided by your homeowners insurance policy usually provides a limit of $300,000 or $500,000. We recommend increasing this protection with a personal umbrella insurance policy. Not only will it increase your personal liability, but also your auto liability coverage. Limits are available from $1 million to $10 million and beyond. The cost of the basic $1 million limits is usually reasonably priced around $200 per year.

Keep in mind that Washington can require certain minimum levels of coverage. The right coverage for you is unique – talk to A & M Insurance Services, Inc. today to find out how to get your needs met on homeowners insurance in Renton, Washington.

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