What is Fire Insurance?
Fire insurance covers the cost of fire-related damage to your home, residential property, and personal property inside. The most common types of fire insurance in Mesa, AZ are HO-2 policies, which cover a specific set of damages, and HO-3 policies, which cover everything. HO-1 policies, which are more restrictive than HO-2 policies, are also offered to homeowners, but they are not as popular as HO-2 or HO-3 policies.
How Does Fire Insurance Protect Your Assets?
There are several different types of coverage that companies such as Lifetime Investments offer. Actual cash value policies are fairly self-explanatory. They pay for the original purchase price of the property damaged in the fire. Replacement value policies are more expensive, but it is important to keep in mind that it is often more expensive to actually replace items than the purchase price of the original items. Guaranteed replacement value policies cover replacement costs, even if they are more than the total coverage of the policy.
What Exactly Does Fire Insurance Cover?
As previously mentioned, fire insurance policies old by companies like Lifetime Investments cover both your building and the possessions inside. However, there are certain limits and restrictions. Most policies provide coverage for possessions in the amount of roughly 60% of the value of the structure. If the structure is worth $100,000, then the possessions are covered up to about $60,000 (depending on the policy). This means that very valuable items such as paintings or jewelry need their own individual policies.
What Are the Limitations of Fire Insurance?
Fire insurance does cover intentional fires, as long as the person responsible is a member of the household that purchased the policy. Most residential fires in Mesa, AZ are covered by fire insurance. However, an intentional fire set by a member of the family will not be covered.
Another limitation of fire insurance is the coverage being exceeded by the value of the home. This can happen when the value goes up more rapidly than expected. Homeowners may need to buy more coverage in this situation.