Disasters: Are You Covered?

Common Questions Asked by Homeowners about Insurance

If a fire, flood, earthquake, or some other natural disaster were to destroy or damage your home, would you have the right insurance coverage to rebuild your house?

This brochure, based on the questions consumers most frequently ask, explains what is covered in a standard homeowners policy and what is not. Where gaps in coverage exist, it tells you how to fill them.

To simplify explanations, we assume that you have a policy known as Homeowners-3 (HO-3), the most common homeowners policy in the United States. Find out what type of homeowners policy you have. If you have a different policy, you should review your options in question #17.

QUESTION # 1: AM I COVERED FOR DIRECT LOSSES DUE TO FIRE, LIGHTNING, TORNADOES, WIND STORMS, HAIL, EXPLOSIONS, SMOKE, VANDALISM AND THEFT?

Answer: Yes. The HO-3 provides broad coverage for these and other disasters or “perils,” as they are called in the policy, including all those listed in the question. You should check the dollar limits of insurance in your policy and make sure you are comfortable with the amount of insurance you have for specific items. Also, if you live near the Atlantic or Gulf coasts there may be some restrictions on your coverage for wind damage. Ask your agent about windstorm/hurricane deductibles. In areas prone to hailstorms, you may have a specific hail damage deductible.

QUESTION # 2: ARE MY JEWELRY AND OTHER VALUABLES COVERED?

Answer: The standard policy provides only from $1,000 to $2,000 for theft of jewelry. If your jewelry is worth a lot more, you should purchase higher limits. You may wish to add a floater to your policy to cover specific pieces of jewelry and other expensive possessions such as paintings, electronic equipment, stamp collections or silverware, for example. The floater will provide both higher limits and protect you from additional risks, not covered in your normal policy.

QUESTION # 3: IF MY HOUSE IS TOTALLY DESTROYED IN A FIRE AND I HAVE $150,000 WORTH OF INSURANCE TO COVER THE STRUCTURE, WILL THIS BE ENOUGH TO REBUILD MY HOME?

Answer: If the cost of rebuilding your home is equal to or less than $150,000 you would have enough coverage. The HO-3 policy pays for structural damage on a replacement cost basis. If the cost of replacing your home is, say, $120,000, then that is all the insurance you need. On the other hand if the cost of rebuilding your home is $180,000, then you will be short $30,000.

If you live in an area that is frequently hit by major storms, ask you insurance company about an extended or guaranteed replacement cost policy. This will provide a certain amount over the policy limit to rebuild your home so that if building costs go up unexpectedly, due to high demand for contractors and materials, you will have extra funds to cover the bill.

If you choose not to rebuild your home, you will receive the replacement cost of your home, less depreciation. This is called actual cash value. You should make sure that the amount of insurance you have will cover the cost of rebuilding your house. You can find out what this cost is by talking to your real estate agent or builders in your area.

Do not use the price of your house as the basis for the amount of insurance you purchase. The market price of your house includes the value of the land on which the house is situated. In almost all cases, the land will still be there after a disaster, so you do not need to insure it. You only need to insure the structure.

QUESTION # 4: AM I COVERED FOR FLOOD DAMAGE?

Answer: No. So, if you live in a flood-prone area it may be wise to purchase flood insurance. Flood insurance is provided by the federal government, under a program run by the Federal Insurance Administration. In some parts of the country, homes can be damaged or destroyed by mudslides. This risk is also covered under flood policies. Contact your agent or company representative to get this insurance or call the Federal Emergency Management Agency at 1-800-427-4661 or visit its Web site atwww.fema.gov.

QUESTION # 5: A PIPE BURSTS AND WATER FLOWS ALL OVER MY FLOORS. AM I COVERED?

Answer: Yes. The HO-3 covers you for accidental discharge of water from a plumbing system. You should check your plumbing and heating systems once a year. While you are covered for damage, who needs the mess and hassle?

QUESTION # 6: WHAT IF WATER SEEPS INTO MY BASEMENT FROM THE GROUND, AM I COVERED?

Answer: No. Water seepage is excluded under the HO-3. And if the water seepage is not due to a flood you will not be covered under a flood policy. Seepage is viewed as a maintenance issue and is not covered by insurance. You should see a contractor about waterproofing your basement.

QUESTION # 7: AM I COVERED FOR EARTHQUAKE DAMAGE?

Answer: No. Earthquake coverage is sold as additional coverage to the homeowners policy. To find out whether you should buy this insurance, talk to your agent or company representative. The cost of this coverage can vary significantly from one area to another, depending on the likelihood of a major earthquake.

QUESTION # 8: A NEIGHBOR SLIPS ON MY SIDEWALK OR FALLS DOWN MY PORCH STEPS AND THREATENS TO TAKE ME TO COURT FOR DAMAGES. DOES MY POLICY PROTECT ME?

Answer: Yes. The policy will pay for damages, if a fall or other accident on your property is the result of your negligence. It will also pay for the legal costs of defending you against a claim. Also, the medical payments part of your homeowners policy will cover medical expenses, if a neighbor or guest is injured on your property. You should check to see how much liability protection you have. The standard amount is $100,000. If you feel you need more, consider purchasing higher limits.

QUESTION # 9: A TREE FALLS AND DAMAGES MY ROOF DURING A STORM. AM I COVERED?

Answer: Yes. You are covered for the damage to your roof. You are also covered for the removal of the tree, generally up to a $500 limit. You should cut down dead or dying trees close to your house and prune branches that are near your house. It's true that your insurance covers damage, but falling trees and branches can also injure your family.

QUESTION # 10: DURING A STORM, A TREE FALLS BUT DOES NO DAMAGE TO MY PROPERTY. AM I COVERED FOR THE COST OF REMOVING THE TREE?

Answer: Your trees and shrubs are covered for losses due to risks like vandalism, theft and fire, but not wind damage. However, if a fallen tree blocks access to your home you may be covered for its removal. Decide if you need extra insurance for the trees, plants and shrubs on your property. You may be able to purchase extra insurance, which will not only cover the cost of removing fallen trees, but will also cover the cost of replacing trees, and other plants.

QUESTION # 11: IF A STORM CAUSES A POWER OUTAGE AND ALL THE FOOD IN MY REFRIGERATOR OR FREEZER IS SPOILED AND MUST BE THROWN OUT, CAN I MAKE A CLAIM?

Answer: The general answer is no. However, there are a number of exceptions. In some states, food spoilage is covered under the homeowners policy. In addition, if the power loss is due to a break in a power line on or close to your property, you may be covered. You should check with your agent to find out whether you are covered for food spoilage in your state. If not, you can add food spoilage coverage to your policy for an additional premium.

QUESTION # 12: I HAVE CHILDREN AWAY AT COLLEGE. ARE THEY COVERED BY MY HOMEOWNERS INSURANCE?

Answer: If they’re full-time college students and part of your household, your insurance generally provides some coverage in a dorm, typically 10 percent of the contents limit. If they live off campus, some companies may not provide this limited coverage if the apartment is rented in the student’s name.

QUESTION # 13: MY GOLF CLUBS ARE STOLEN FROM THE TRUNK OF MY CAR. DOES MY HOMEOWNERS POLICY COVER THE LOSS?

Answer: Yes. The HO-3 covers your personal property while it is anywhere in the world. However, if your golf clubs are old, you will only get their current value, which may not be enough to purchase a new set. Consider buying a replacement cost endorsement for your personal property. This way you will get what it costs to replace the golf clubs, less the applicable deductible.

QUESTION # 14: I HAVE A SMALL POWER BOAT. IF IT IS STOLEN, AM I COVERED? WHAT IF THERE IS A BOATING ACCIDENT AND I GET SUED? AM I COVERED FOR THAT?

Answer: Whether or not you are covered for either theft or liability depends on the size of the boat, the horsepower of the engine and your insurance company. Coverage for small boats under homeowners policies varies significantly. Ask your insurance representative whether you need a Boatowners policy.

QUESTION # 15: MY HOUSE IS CLOSE TO THE OCEAN. I’VE HEARD THAT IF IT IS DESTROYED BY THE WIND, THE TOWN'S NEW BUILDING CODE REQUIRES ME TO REBUILD THE HOUSE ON STILTS. THIS WILL ADD $30,000 TO THE COST OF REBUILDING MY HOUSE. AM I COVERED FOR THIS EXTRA COST?

Answer: No. The HO-3 excludes costs caused by ordinances or laws that regulate the construction of buildings. You can purchase an Ordinance or Law endorsement. This will cover the extra costs involved in meeting new building codes.

QUESTION # 16: AM I COVERED FOR “ACTS OF GOD”?

Answer: Sometimes. The term “Acts of God” is not specifically mentioned in homeowners insurance policies. It usually refers to natural disasters like hurricanes and tornadoes, as opposed to man-made acts, like theft and auto accidents. Some natural disasters, such as damage from windstorms, hail, lightning and volcanic eruptions, are covered under homeowners insurance. Damage from floods and earthquakes is not.

QUESTION # 17: WHAT SHOULD I DO IF MY POLICY PROVIDES LESS COVERAGE THAN THE HO-3?

Answer: Review your coverage with your agent. Some older policies provide less coverage than the HO-3. They may not provide coverage for water damage, theft, or liability. They may also provide coverage for the house on an actual cash value basis, rather than a replacement cost basis.

Actual Cash Value means replacement cost less depreciation. For example, if your roof is destroyed in a storm, the insurance will only pay for the cost of a new roof less the amount of depreciation of the old roof. If your roof was in great shape, this deduction will not be large. However, if the roof was old and worn out, the deduction for depreciation may be significant. You should try to get an HO-3.

For more information, contact your agent or company representative. You can also visit: Insurance Information Institute

This brochure was reviewed by the Cooperative State Research, Education, and Extension Service, USDA. For additional assistance with homeownership questions, contact your County Extension office listed under County Government in your local telephone directory.

Halloween: Fun for Kids, Worries for Adults

What's a big treat for kids of all ages but a big worry for parents and motorists? It's Halloween!

Parents can minimize risks this October 31 by making sure their trick-or-treating youngsters follow some safety tips, advises the Insurance Information Institute (I.I.I.).

Smart parents can ensure a safe Halloween by accompanying small children around the neighborhood. If children are old enough to explore the neighborhood on their own, advise them to visit homes where they know they'll be welcome. If the house is dark and uninviting, tell the kids to stay away.

Parents should also leave the porch light on once it's dark. It will be a signal that you welcome kids and it also will help to brighten the neighborhood.

Parents should warn children to stay on the sidewalk and to cross the streets carefully. It's also a good idea to put reflective tape on costumes and trick-or-treat bags and to arrange for youngsters to go out in groups rather than individually.

Here are more safety tips:

• Make sure costumes aren't loose-fitting, which could cause the child to trip and fall.
  
  
• Use make-up instead of masks. Some masks can obstruct the child's vision.
  
  
• Make sure all costumes are made of non-flammable material.
  
  
• Keep lighted jack-o'-lanterns and candles away from children or flammable materials.
  
  
• Inspect all treats before allowing children to eat them.

The I.I.I. urges motorists to drive slowly in residential areas and to honk their horns on dimly lit streets to alert children. Drivers also need to watch out for youngsters crossing against the light, darting out from between parked cars and walking in the street.

For More Information Visit: Insurance Information Institute

Halloween: Fun for Kids, Worries for Adults

What's a big treat for kids of all ages but a big worry for parents and motorists? It's Halloween!

Parents can minimize risks this October 31 by making sure their trick-or-treating youngsters follow some safety tips, advises the Insurance Information Institute (I.I.I.).

Smart parents can ensure a safe Halloween by accompanying small children around the neighborhood. If children are old enough to explore the neighborhood on their own, advise them to visit homes where they know they'll be welcome. If the house is dark and uninviting, tell the kids to stay away.

Parents should also leave the porch light on once it's dark. It will be a signal that you welcome kids and it also will help to brighten the neighborhood.

Parents should warn children to stay on the sidewalk and to cross the streets carefully. It's also a good idea to put reflective tape on costumes and trick-or-treat bags and to arrange for youngsters to go out in groups rather than individually.

Here are more safety tips:

• Make sure costumes aren't loose-fitting, which could cause the child to trip and fall.
  
  
• Use make-up instead of masks. Some masks can obstruct the child's vision.
  
  
• Make sure all costumes are made of non-flammable material.
  
  
• Keep lighted jack-o'-lanterns and candles away from children or flammable materials.
  
  
• Inspect all treats before allowing children to eat them.

The I.I.I. urges motorists to drive slowly in residential areas and to honk their horns on dimly lit streets to alert children. Drivers also need to watch out for youngsters crossing against the light, darting out from between parked cars and walking in the street.

For More Information Visit: Insurance Information Institute

Winter Weather Preparation

Ice, snow and wind can have devastating consequences on your home. The time to winterize is when the leaves begin to turn and not when the snow begins to fall.

Homeowners should take the following precautions:

Maintain Gutters
Remove leaves, acorns, sticks and other debris from gutters so melting snow and ice can flow freely. This can prevent "ice damming"–a condition where water is unable to properly drain through the gutters and instead seeps into the house causing water to drip from the ceiling and walls. You may also consider installing gutter guards. Available in most hardware and home stores, gutter guards are screens that prevent debris from entering the gutter and direct the flow of water away from the house and into the ground.

Trim Trees and Remove Dead Branches
Ice, snow and wind can cause weak trees or branches to break, damaging your home, car or injuring someone walking on your property.

Check Insulation
Add extra insulation to attics, basements and crawl spaces. If too much heat escapes through the attic it can cause snow or ice to melt on the roof. The water re-freezes causing more snow and ice to build up. This can result in a collapsed roof, and can contribute to ice damming. Ideally, the attic should be five to ten degrees warmer than the outside air. Well-insulated basements and crawl spaces will also help protect pipes from freezing.

Maintain Pipes
Wrap pipes with heating tape and insulate unfinished rooms such as garages that frequently have exposed pipes. Also, check for cracks and leaks. Have minor pipe damage fixed immediately to prevent much costlier repairs in the future.

Keep the House Warm
The temperature in your house should be at least 65 degrees. The temperature inside the walls where the pipes are located is substantially colder than the walls themselves. A temperature lower than 65 degrees will not keep the pipes from freezing.

Check Heating Systems
The proper use and maintenance of furnaces, fireplaces and wood-burning stoves can prevent fire and smoke damage. Have furnaces, boilers and chimneys serviced at least once a year. Make sure that smoke and fire alarms are working properly and consider installing a carbon dioxide detector.

Maintain Steps and Handrails
Broken stairs and banisters can become lethal when covered with snow and ice. Make repairs now to prevent someone from falling and seriously being injured.

Get To Know Your Plumbing
Learn how to shut the water off and know where your pipes are located. If your pipes freeze, time is of the essence. The quicker you can shut off the water or direct your plumber to the problem, the better chance you have to prevent the pipes from bursting.

Hire A Licensed Contractor
Have a professional survey your home for any structural damage. If damage is discovered, have it repaired immediately so further damage will not occur during the winter. Also, find out about ways to prevent water damage due to snow-related flooding. Plastic coatings for internal basement walls, sump-pumps and other methods can prevent damage to your home and belongings.

Plan For Being Away
If you are not going to be in your home this winter for an extended period of time, have the water system drained by a professional to keep pipes from freezing or bursting. Also, have someone check on your home on a regular basis. If there is a problem, it can be fixed quickly, thus lessening any damage. Activity at your home will also reduce the likelihood that it will be burglarized.

Standard homeowners policies cover winter-related disasters such as burst pipes, ice dams, wind damage caused by weight of ice or snow.

Damage to homes caused by flooding is usually excluded from most standard homeowner policies. Flood insurance is available from the National Flood Insurance Program. Ask your insurance professional about flood insurance, as well as specific advice about winter-proofing your home.

For More Information Visit: Insurance Information Institute

Deer-Vehicle Collisions Are On the Rise - Make Sure You Have Comprehensive Coverage On Your Auto Policy

Cars and deer can be a lethal combination. Deer migration and mating season generally runs from October through December, and causes a dramatic increase in the movement of the deer population. As a result, more deer-vehicle collisions occur in this period than at any other time of year, so drivers need to be especially vigilant, according to the Insurance Information Institute (I.I.I.).

Damage caused by an accident with deer or other animals is covered under the optional comprehensive portion, not the collision portion, of an automobile insurance policy. Comprehensive auto insurance includes almost everything that might go wrong with your vehicle, except collision, including: fire, theft, vandalism or malicious damage, riot, flood, earthquake or explosion, hail, windstorm, falling or flying objects, damage due to contact with a bird or animal and sometimes, depending on the policy, windshield damage.

There are more than 1.6 million deer-vehicle collisions each year resulting in about 200 fatalities, tens of thousands of injuries and over $3.6 billion in vehicle damage. An additional billion dollars is spent on medical payments for injuries to people in the car and out-of-pocket expenses paid by vehicle owners, bringing the total cost to approximately $4.6 billion.

The average claim for deer-vehicle collisions is $3,100, with costs varying depending on the type of vehicle and severity of the damage, up 1.7 percent from a year ago. While the number of miles driven by U.S. motorists over the past five years has increased just 2 percent, the number of deer-vehicle collisions during that time has grown by 10 times that amount.

State Farm estimates that 2.3 million collisions between deer and vehicles occurred in the U.S. during the two-year period between July 1, 2008 and June 30, 2010. That is 21.1 percent more than five years earlier.

Not only is urban sprawl displacing deer from their natural habitat, but the deer population is also growing. As a result, many of them find their way onto highways and into suburban neighborhoods, especially during deer season.

“As our wildlife habitat continues to shrink, accidents with deer and other animals are likely to increase,” said Loretta Worters, vice president of the I.I.I. “Drivers should stay alert and pay particular attention to the sides of the road, especially during the hours just before dusk and just before daylight.”

Fortunately, there are steps you can take to decrease the likelihood of being involved in a deer-vehicle collision.

Drivers should be aware of the following:

• Deer are not just found on rural roads near wooded areas; many deer crashes occur on busy highways near cities.

• Deer are unpredictable, especially when faced with glaring headlights, blowing horns and fast-moving vehicles. They often dart into traffic.

• Deer often move in groups. If you see one, there are likely to be more in the vicinity.

Drivers should take the following precautions:

• Drive with caution when moving through deer-crossing zones, in areas known to have a large deer population and in areas where roads divide agricultural fields from forestland.

• Always wear your seatbelt. The Insurance Institute for Highway Safety reports that in a study of fatal animal crashes, 60 percent of people killed were not wearing a seatbelt. Sixty-five percent of people killed in animal related crashes while riding motorcycles were not wearing a helmet.

• When driving at night, use high beam headlights when there is no oncoming traffic. The high beams will better illuminate the eyes of any deer on or near the roadway.

• Be especially attentive from sunset to midnight and during the hours shortly before or after sunrise. These are the highest risk times for deer-vehicle collisions.

• Brake firmly when you notice a deer in or near your path, but stay in your lane. Many serious crashes occur when drivers swerve to avoid a deer and hit another vehicle or lose control of their cars.

• Do not rely on devices such as deer whistles, deer fences and reflectors to deter deer. These devices have not proven effective.

In the event your vehicle strikes a deer, try to avoid going near or touching the animal. A frightened and wounded deer can hurt you and further injure itself. If the deer is blocking the roadway and poses a danger to other motorists, you should call the police immediately.

Contact your insurance agent or company representative as quickly as possible to report any damage to your car.

FOR MORE INFORMATION ABOUT INSURANCE: WWW.III.ORG

THE I.I.I. IS A NONPROFIT, COMMUNICATIONS ORGANIZATION SUPPORTED BY THE INSURANCE INDUSTRY.

INSURANCE INFORMATION INSTITUTE, 110 WILLIAM STREET, NEW YORK, NY 10038, (212) 346-5500

Why Should I Consider Purchasing an Annuity?

Annuities can serve many useful purposes.

If you are in a saving-money stage of life, a deferred annuity can:

• Help you meet your retirement income goals. Employer-sponsored plans such as a 401(k), 403(b) or Keogh are an important part of planning for retirement. However, contributions to these plans and to IRAs are limited, and they might not add up to enough for the retirement income you need, especially if you started saving for retirement late or had contributions interrupted—perhaps due to job changes and/or family responsibilities. Moreover, your social security and defined-benefit pension (if you have one) may provide less than you need to retire. Remember that the purchasing power of defined-benefit pension income is eroded by inflation.
• Help you diversify your investment portfolio. Investment experts routinely advise that, to get the best return for a given level of risk, you should diversify your investments among a number of asset classes. Fixed annuities, in particular, offer a unique asset class—an investment that is guaranteed not to decrease and that will actually increase at a specified interest rate (and, often, potentially more). The guarantees are supported by the claims-paying ability of the insurer.
• Help you manage your investment portfolio. Investment experts routinely advise that, whenever your investments in various asset classes get too far from the percentage allocations you prefer, you “rebalance” to the original formulation, by shifting funds from the classes that have grown faster to the ones that have grown more slowly. If you do this with mutual funds, you pay capital gains taxes; if you do it in a variable annuity, you don’t pay capital gains taxes. When you eventually withdraw money from the annuity (which could be many years after the rebalancing), you pay tax then at the ordinary income rate.

If you are in a need-income stage of life, an immediate annuity can:

• Help protect you against outliving your assets. Social security pays retirement income for as long as you live, as do defined-benefit pension plans. But the only other source of income available that continues indefinitely is an immediate annuity.
• Help protect your assets from creditors. Generally the most that creditors can access is the payments from an immediate annuity as they’re made, since the money you gave the insurance company now belongs to the company. Some state statutes and court decisions also protect some or all of the payments from those annuities.

For More Information Visit: Insurance Information Institute

What Is In a Standard Homeowners Insurance Policy?

A standard homeowners insurance policy includes four essential types of coverage. They include:

1. Coverage for the structure of your home.
2. Coverage for your personal belongings.
3. Liability protection.
4. Additional living expenses in the event you are temporarily unable to live in your home because of a fire or other insured disaster.

1. The structure of your house

This part of your policy pays to repair or rebuild your home if it is damaged or destroyed by fire, hurricane, hail, lightning or other disaster listed in your policy. It will not pay for damage caused by a flood, earthquake or routine wear and tear. When purchasing coverage for the structure of your home, it is important to buy enough to rebuild your home.

Most standard policies also cover structures that are detached from your home such as a garage, tool shed or gazebo. Generally, these structures are covered for about 10% of the amount of insurance you have on the structure of your home. If you need more coverage, talk to your insurance agent about purchasing more insurance.

2. Your personal belongings

Your furniture, clothes, sports equipment and other personal items are covered if they are stolen or destroyed by fire, hurricane or other insured disaster. Most companies provide coverage for 50% to 70% of the amount of insurance you have on the structure of your home. So if you have $100,000 worth of insurance on the structure of your home, you would have between $50,000 to $70,000 worth of coverage for your belongings. The best way to determine if this is enough coverage is to conduct a home inventory.

This part of your policy includes off-premises coverage. This means that your belongings are covered anywhere in the world, unless you have decided against off-premises coverage. Some companies limit the amount to 10% of the amount of insurance you have for your possessions. You have up to $500 of coverage for unauthorized use of your credit cards.

Expensive items like jewelry, furs and silverware are covered, but there are usually dollar limits if they are stolen. Generally, you are covered for between $1,000 to $2,000 for all of your jewelry and furs. To insure these items to their full value, purchase a special personal property endorsement or floater and insure the item for it's appraised value. Coverage includes “accidental disappearance,” meaning coverage if you simply lose that item. And there is no deductible.

Trees, plants and shrubs are also covered under standard homeowners insurance. Generally you are covered for 5% of the insurance on the house—up to about $500 per item. Perils covered are theft, fire, lightning, explosion, vandalism, riot and even falling aircraft. They are not covered for damage by wind or disease.

3. Liability protection

Liability covers you against lawsuits for bodily injury or property damage that you or family members cause to other people. It also pays for damage caused by your pets. So, if your son, daughter or dog accidentally ruins your neighbor’s expensive rug, you are covered. However, if they destroy your rug, you are not covered.

The liability portion of your policy pays for both the cost of defending you in court and any court awards—up to the limit of your policy. You are also covered not just in your home, but anywhere in the world.

Liability limits generally start at about $100,000. However, experts recommend that you purchase at least $300,000 worth of protection. Some people feel more comfortable with even more coverage. You can purchase an umbrella or excess liability policy which provides broader coverage, including claims against you for libel and slander, as well as higher liability limits. Generally, umbrella policies cost between $200 to $350 for $1 million of additional liability protection.

Your policy also provides no-fault medical coverage. In the event a friend or neighbor is injured in your home, he or she can simply submit medical bills to your insurance company. This way, expenses are paid without a liability claim being filed against you. You can generally get $1,000 to $5,000 worth of this coverage. It does not, however, pay the medical bills for your family or your pet.

4. Additional living expenses

This pays the additional costs of living away from home if you can't live there due to damage from a fire, storm or other insured disaster. It covers hotel bills, restaurant meals and other living expenses incurred while your home is being rebuilt. Coverage for additional living expenses differs from company to company. Many policies provide coverage for about 20% of the insurance on your house. You can increase this coverage, however, for an additional premium. Some companies sell a policy that provides an unlimited amount of loss-of-use coverage, but for a limited amount of time.

If you rent out part of your house, this coverage also reimburses you for the rent that you would have collected from your tenant if your home had not been destroyed.

For More Information Visit: Insurance Information Institute

Preparing an Effective Evacuation Plan

In the event of a sudden emergency such as a hurricane, you may have just minutes to gather your family and important papers, and get out of your house, possibly for good. Are you prepared? Where would you go? What would you take with you?

With preparation and practice, you stand the best chance of getting out with what you and your family need, and ending up in the right place.

Planning ahead is crucial; this five-step plan can help get you and your family on the road to safety.

1. Arrange Your Evacuation Ahead of Time

• Identify where you can go in the event of an evacuation. Try to have more than one option: the home of a friend or family member in another town, a hotel or a shelter. Keep the phone numbers and addresses of these locations handy.
• Map out your primary route and a backup route in case roads are blocked or impassable. Make sure you have a map of the area available.
• In case your family members are separated before or during the evacuation, identify a specific place to meet and ask an out-of-town friend or family member to act as a contact person.
• Listen to NOAA Weather Radio or local radio or TV stations for evacuation instructions. If advised to evacuate, do so immediately.

2. Create a Home Inventory

A home inventory will help ensure that you have purchased enough insurance to replace your personal possessions. It can also speed the claims process and substantiate losses for income tax purposes. A detailed home inventory is also helpful should you need to apply for disaster aid.

To make creating a home inventory easier, the I.I.I. provides free Web-based software at KnowYourStuff.org. Know Your Stuff allows you to organize easily and list your possessions, as well as add digital photographs of your valuables and upload scanned receipts. The program provides free, secure storage of your inventory on Amazon Web Services. Storing your inventory online gives you the ability to access it from any computer in the event your own computer is damaged or destroyed.

3. Plan What to Take

• Medicines, prescriptions and first aid kit
• Bottled water
• Clothing and bedding (sleeping bags, pillows)
• Flashlight, battery-powered radio and extra batteries
• Special items for infants or elderly or disabled family members
• Computer hard drive or laptop
• Photographs
• Pet food and other items for pets (litter boxes, leashes)

4. Gather Important Documents

Keep important documents in a safe place that you can access easily. In the event of an evacuation take the following documents with you:

• Insurance policies
• Prescriptions
• Birth and marriage certificates
• Passports
• Drivers license or personal identification
• Social Security cards
• Recent tax returns
• Employment information
• Wills, deeds and recent tax returns
• Stocks, bonds and other negotiable certificates
• Bank, savings and retirement account numbers
• Home inventory

5. Take the Ten-Minute Challenge

To find out if you are ready, do a real-time test. Give yourself just 10 minutes to get your family and belongings into the car and on the road to safety. By planning ahead and practicing, you should be able to gather your family members and pets, along with the most important items they will need, calmly and efficiently, with a minimum of stress and confusion.

The Following Video Provides Additional Tips

For More Information Visit: Insurance Information Institute