When you purchase a homeowners insurance policy in Dallas / Fort Worth, Texas, the current value of your house at the time you buy coverage is the amount that you purchase. The problem is that the current market value of a home may not be the same as the price you paid to purchase the house, which may mean that you have more coverage that the market value.
Protection from Losses
Even if the house is covered for more than the current value, you are protected against a loss if your house faces a fire or similar incident. The insurer will evaluate the total loss based on the amount of damage, police reports and any other proof that you provide regarding personal belongings that were in the house at the time the damage took place.
In most cases, you will not receive the full amount on your insurance policy when you make a claim unless the assessment suggests that the value of the house is greater than you estimated.
Insurers will usually evaluate the amount of damage and pay for the repairs based on the value of the house, which means that you have too much insurance if the current plan exceeds the value of your home.
In general, it is best to evaluate your coverage on a regular basis and update your plan to reflect the market value of your home, whether the value of the house increases or decreases over time. The reason is simple: when you change your policy, you will not end up with more coverage than you need. To learn more about your policy options, contact us to speak to an independent agent.