Issue Date: November 2, 2007

Wildfire Question: Am I Covered?

By Jody Zink
Licensed Realtor in Ohio & Michigan

With over a half-million people displaced by fire in southern California, even more than that are begging the question, am I covered? Something worse than losing your home is not having enough insurance to replace it.

We always think it won't happen to us. And most of the time, I think we're right. Lake
Erie isn't due for any tsunami activity, but floods can happen. Tornado season is pretty much wrapped up as well, but two of my friends in Pensacola, Florida took cover just 2 weeks ago. We're not prone to wildfire in these parts, but arsonists are out there.

Insurance is meant to help pick up the pieces when faced with disaster. Policyholders
sometimes learn too late that there's not enough coverage to return to their previous
lifestyle. Here's an opportunity to learn from someone else's mistakes and a prompt to review your policy.

Make sure you have the right kind of coverage. Companies can deny claims based on what caused the damage. Homeowner's insurance would cover wind blowing the house down, or rain coming through a collapsed roof, but many Katrina victims were denied because they didn't have special flood insurance. If your home suffered a sewer or drain backup this weekend, would you be covered?

You've heard it before, but probably haven't done it. Take inventory. Take photos of your home and its contents and put them in a safe place away from your home and someplace you'll remember! Maybe email them to yourself or keep them at work.

If your home is ever destroyed, you'll want to be able to rebuild it to its original
condition. This may cost significantly more than its value on the open market.
Homeowners have to specifically ask for a ?guaranteed replacement policy,? otherwise
insurers many only issue an extended replacement policy which sets payout limits plus an extended 20 to 25 percent of additional payout. This likely wouldn't be enough to cover rebuilding costs.

A standard policy will likely insure your things at actual cash value. That's the value
of an item at the time of loss. To be sure you can fully replace lost or stolen items,
you may want to add an endorsement for replacement cost coverage, which would replace the item with one of similar make and model, regardless of the actual cash value. It may cost you a bit more. The term again: replacement coverage. Don't assume you already have it. Many people think they do. Some learn they don't until after tragedy has struck.

Take the time to call your insurance agent. I've stressed in previous columns how
important it is to work with your Realtor as a partner in achieving you real estate
goals. Working with your insurance agent is just as crucial. He or she is an expert and can explain whether you have enough coverage and the right kind.

Steps you take now could make all the difference. In case disaster strikes, give
yourself the best chance to recover.

Jody Zink is a licensed REALTOR in Ohio and Michigan with the Loss Realty Group. Her column appears every other week in the Toledo Free Press. She can be reached at jody@jodyzinkrealtor.com or 419-725-1881.