❖ Tip: Record a video inventory of the con- tents of your home, including items stored in structures such as a garage or shed. Update the video annually and store it in a safe deposit box. In the event of a loss, you will have an accurate record of your possessions, which makes a claim easier to process.
❖ Tip: A quick way to estimate the amount of
insurance coverage needed is to multiply the
total square footage of the home by the local
building cost per square foot. To determine the
building costs in your area, contact a local real
estate agent or builders association, or use one
of the many online building-cost estimators.
Additional living expenses. In the event
that a major covered loss such as a fire or
severe storm makes your home uninhabitable, additional living-expense coverage will
pay for items such as restaurant meals, hotel
or rental bills, and other living expenses that
you incur while your home is being repaired.
Home insurance policies generally provide
about 20 percent of the amount of insurance
on the structure of a home for additional living-expense coverage.
Liability coverage. Home insurance provides liability coverage for injuries or property damage that you or family members
cause to other people. Make sure liability limits are enough to protect your assets; if you
have investments, savings and/or additional
property that are worth more than your current liability limits, you may want to purchase an excess-liability policy, often called
an umbrella policy.
IF YOU ARE LIKE MOST people, buying a
home is the largest investment you will
make in your lifetime. Home insurance
helps protect that investment by providing
coverage for the building itself, your personal possessions and liability for injuries to
others while they are on your property.
What is the right amount of coverage to
protect your assets? An insurance industry
survey in 2008 reported that 64 percent of
homes in the U.S. are underinsured. That
means more than half of all homeowners
would not have enough coverage to rebuild
their homes if they suffered a total loss.
Consider the following guidelines and
tips from Ameriprise Auto & Home
Insurance when reviewing your home
Housing structure. Be sure to have
enough insurance coverage to rebuild your
home based on current construction costs
in your area, not on what you paid for your
home, and don’t include the cost of the land.
The cost to rebuild a home may be more or
less than the price originally paid for the
Actual cash value versus replacement
cost. Actual cash value pays to replace a home
and possessions minus the cost of depreciation. That means if a claim is filed for a five-year-old TV, you will be paid the value of a
five-year-old TV, which could be less than
you expect. Replacement cost will replace
your home and possessions for the actual cost
without deducting depreciation. The premiums for replacement-cost insurance coverage
can cost more than those for actual cash value
coverage, but you are more likely to get an
accurate reimbursement for your loss. Refer
to your policy for complete coverage details.
Personal possessions. The coverage for
personal belongings is based on the coverage
on the structure of your home—typically
between 50 and 80 percent of that amount. To
make sure this is adequate, you should create
a home inventory of all of your possessions,
including the costs to replace each item.
Standard home policies provide limited coverage for certain high-value items, such as
fine art, jewelry or computers. Consider adding special personal property endorsements
to your policy as additional coverage.
❖ Tip: Liability insurance also pays for legal
expenses from a liability lawsuit. Homeowners
should have at least $300,000 to $500,000 of
liability coverage to protect their assets.
Umbrella liability policies extend to both
auto and home insurance and provide broader
coverage for libel, slander and invasion of
privacy—items excluded on standard auto
and home policies. C
Insurance is underwritten by IDS Property Casualty Insurance Company and Ameriprise Insurance Company, both in
De Pere, Wisconsin. Each company is a subsidiary of Ameriprise Financial, Inc. Discounts and savings vary by state and
apply to certain coverages. Insurance availability and coverage may vary by region or state. Ameriprise Auto & Home
Insurance’s California license number is 0C41813. Costco Insurance Agency, Inc.’s California license number is 0D08407.
See the Ameriprise Auto & Home Insurance ad on the back cover of this issue for more details.
COSTCO MEMBERS are eligible for
significant savings, outstanding service
and exclusive benefits from Ameriprise
Auto & Home Insurance, as more than
275,000 members have already discovered. In most cases you will receive a
discount on your insurance premium
just for being a Costco member.
Get a qualified auto insurance
quote in May 2011 and Ameriprise
Auto & Home Insurance will donate
$5 to participating children’s hospitals. Since first partnering with Costco
in 2008, they have helped raise more
than $240,000 for the Children’s
Miracle Network Hospitals.
To find out more, call toll-free
1-866-370-7998, or go to Costco.com
and search “cmndonation.”
MAY 2011 ;e Costco Connection 89