“Holding down the fort” used to be a matter of muskets and maybe a guard dog or two. In our modern age, the gun and dog have been replaced by insurance — particularly homeowners insurance. With the increasing need for homeowners insurance, it is startling to consider that 76 percent of Americans are improperly insured, according to a study by Marshall and Swift.

Homeowners need protection against liability (in case someone is injured on their property) and theft of or damage to their property.

These are the five most common forms of homeowners insurance:

Basic
Broad
Special
Tenants
Condominium and co-operative apartments

There are some basic questions you need to answer in deciding on a homeowners policy that is right for you.

How much is enough? How much would it cost to rebuild your home if it were leveled? Typically, if you are insured for 80 percent or more of the cost of rebuilding, your carrier will pay the total cost of any repair, up to the limit of your coverage. If not, only a proportionate percentage of the cost of repairs will be paid. Because of this drawback, you should consider buying guaranteed replacement, a feature that ensures almost full reimbursement for repair costs.

Do you need a guaranteed replacement provision? A guaranteed replacement provision places responsibility for valuation of your home on the shoulders of your insurance company. Your insurance company will conduct this appraisal, make sure your coverage is adequate, and automatically upgrade your policy as the value of your property increases. Your premium rises automatically along with this increase.

A standard policy may cover your home’s contents for half the dollar limit you carry on the house. Unless you buy replacement-value coverage, you will only be reimbursed for the depreciated value of your furniture and belongings. With a replacement-value provision, the policy will pay to replace your lost furniture and belongings with new or equal-quality items at current market prices. However, unless specified, your policy may not cover work required to bring the property current with existing building codes.

Do you have any additional valuables you need to protect? For an additional cost, you can add “floaters.” They are designed to cover specific valuables such as jewelry, silverware, furs, a valuable collection, or the contents of your safe-deposit box, up to a certain amount. Additional coverage may also be desired, such as flood or earthquake insurance, if you live in a high-risk zone.

Home is where the heart is. Be sure your home and its contents are adequately insured.

© 2006 Emerald Publications

HOME INSURANCE

The 17 Perils Actual Cash Value vs.Replacement Cost Understanding Deductibles Documentation of Valuables Expanding Coverage Floaters for the finer things Flood Insurance Insuring a Home Liability Coverage The Basics of Homeowners Insurance Cover yourself an Umbrella Liability Insuring a Condominium Special Circumstances Renters Insurance

VEHICLE INSURANCE

On the move: Auto/Vehicle Insurance Protection Auto Insurance Basics Additional and Optional Coverage Who's at fault Premiums and Discounts What to do after an accident Getting your car back Using your personal car for business Risky Drivers Adding a teen or college-bound driver Motorcycle Insurance Watch the Hull Specialty Policies Insure Fun Aviation Insurance

RISK MANAGEMENT

Term Life Insurance Whole Life Insurance Universal Life Insurance Variable Life Insurance Auto Insurance Insurance Claims Maximizing Insurance Benefits Insuring your future Protecting your home Accessing disability insurance Types of Health Care Additional Liability Coverage HMO's and PPO's Evaluating Insurance Companies Long-term Care Costs Medicare Coverage Long-term Care Needs