Take a close look at the terminology of your home insurance policy. In nearly all situations, homeowners will have a stated limit on the amount a claim can be. This limit, for example, on the structure, is pre-determined at the time of the purchase of the home.
What happens if something occurs and the damage is significantly higher than this limit? This is when having reimbursement extended limits can help.
What is Reimbursement Extended Limits?
Reimbursement extended limits is a type of add-on to your existing home insurance plan. This provides financial protection for homeowners when an incident occurs and the damage is beyond what the actual policy covers.
For example, a storm causes a significant amount of damage to your home. Your policy covers the peril (the storm in this case). However, your property loss is higher than what the policy allows.
Reimbursement extended limits can step in to offer more financial protection. Most of these policies will add coverage that is up to 120 percent of your existing coverage. If you have $100,000 in structure protection, you may have up to $120,000 added to your coverage.
When Should You Have This Type of Coverage?
Most homeowners can benefit from this type of additional protection. There are two key reasons:
- The incident that occurs causes extensive damage beyond what your current policy protects. A fire, for example, may occur. It may cost more to rebuild your home than your actual home insurance offers, though. Reimbursement extended limits helps extend your limits.
- The incident requires more to recoup from due to higher costs. For example, a storm can cause widespread damage to an area. This increases the costs associated with rebuilding because materials become scarce. As costs rise, this may exceed the coverage of a base home insurance plan. Reimbursement extended limits can help extend that protection further.
Not all home insurance plans offer this type of insurance protection. Talk to your insurer about your current coverage limits. Ask key questions. Is your limit high enough to cover rebuilding your home? What is the average cost of repairs in the area? Is your policy enough?
An agent can customize your home insurance to meet your needs. The policy should offer as much financial protection as possible for you in a time of need. Adding reimbursement extended limits can help.
Peachstate Insurance is here to help you choose the homeowners policy that you need. If you are interested in reimbursement extended limits, call us today at (877) 997-2478 for more information and to get homeowners insurance Savannah GA quote.