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Key Terms In Your Homeowners’ Insurance Policy Explained

Our Homeowners’ Insurance Attorneys Define Some Important Homeowners’ Insurance Policy Terms

Have you ever read your homeowners’ insurance policy?  If you have, chances are you were left with more questions than answers when you reached the end of it.  Insurance policies are complex and the terminology is often quite technical.  Terminology is rarely even consistent among policy, leading to even further confusion. To aid in your understanding of your homeowners’ insurance policy, we discuss below some key terminology you should know.  For individualized assistance with your claim or other homeowners’ insurance related matter, contact our Miami homeowners’ insurance lawyers at Greenberg, Stone & Urbano.

  1. Replacement cost: Replacement cost is the amount of money it will take to replace your damaged or destroyed home or covered personal item in the same or similar market.  Replacement cost is calculated based on the initial price you paid for the home or item.  Depreciation is not considered.
  2. Actual cash value: Actual cash value or ACV varies from replacement cost in that the actual cost value is based on market value or the initial cost of your home with depreciation taken into account.  Most homeowners’ insurance policies will cover the actual cash value of your damaged or destroyed personal property, but the replacement cost of your home’s physical structure.
  3. Water backup: Water damage is one of the most common incidents to inflict property damage.  Water can backup due to a variety of malfunctions with appliances or other features within your home.  Most standard homeowners’ insurance policies will not cover water backup.  You will want to explore separate coverage for this serious problem.
  4. Allrisk coverage: All-risk coverage will list everything that is not included in your coverage, which can make it easier to assess your policy exclusions.  All-risk coverage is fairly comprehensive and will allow many homeowners to feel secure with their policy.
  5. Additional living expenses: Homeowners can seek reimbursement for the costs of temporary housing, food, and other living expenses if the home has been damaged due to a covered peril that makes the home uninhabitable.  Additional living expenses are generally capped.
  6. Deductible: Your deductible is the amount you must pay before any payment is due from the insurance company.  You should review your deductibles so that you anticipate this sum in the event you ever need to file a claim.
  7. Material misrepresentation: Your claim could be denied due to a material misrepresentation, which is a significant misstatement on your application form.  If your claim has been denied on this basis, contact our homeowners’ insurance attorneys for assistance.  Your denial may be appealable.

Contact the South Florida Homeowners’ Insurance Attorneys at Greenberg, Stone & Urbano Today to Schedule Your Free Consultation!

Understanding your homeowners’ insurance policy is a feat for almost anyone.  Homeowners’ insurance claims are notoriously complex and purposefully hard for laypeople to understand. If you need assistance with your homeowners’ insurance claim, contact the Miami Homeowners’ Insurance Lawyers at Greenberg, Stone & Urbano.  Our experienced attorneys assist homeowners across the state with their insurance claims.  At Greenberg, Stone & Urbano, we bring over 130 years of combined professional experience to your case.  We will fight to see that our insured clients obtain the coverage for their claims that they deserve.   Our firm received the honor of receiving an AV rating from Martindale-Hubbell and were named a Top South Florida Law Firm by the Miami Herald.  Call us today at (888) 499-9700 or (305) 595-2400 to schedule your free consultation.  You can also contact us online.


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