Yes. You can get one of three different replacement cost policies or an actual cash value policy.
The actual cash value policy pays fair market value of the house up to the policy limits. Fair market value is determined by appraisals on similar homes in the area minus the value of the land. This kind of policy does not account for inflation from year and can end up costing more out of pocket than a replacement cost policy.
Replacement Cost Coverage policies cover the full cost of replacing your home up to the policy limits without deducting for depreciation. Extended/Modified Replacement Cost policies will cover a percentage over your policy limit to rebuild your home. This will protect you in case of inflation. Guaranteed Replacement Cost policies are rare but can be found. This kind of policy will pay whatever it costs to rebuild your home as it was prior to the disaster.
California Homeowners Insurance FAQ: What does my California Homeowners Insurance Cover?
California homeowners insurance covers your home, other structures on your property as well as your personal effects, up to 50% of the replacement cost of your home in the event of damage or destruction due to fire or lightening, windstorms or hail, vandalism (including vandalism caused by riots), smoke, vehicles, aircraft, theft, explosion or breakage of glass. If you need additional protection for your personal effects, such as furs, art or antiques you will need to purchase additional insurance.
California homeowners insurance also covers loss of use and additional living expenses in case you are not able to live in your home. This includes food, lodging, furniture rental, relocation and storage costs, and transportation costs incurred to maintain your normal lifestyle.
The liability portion of your California homeowners insurance policy will cover non-family members who are hurt on your property, even if they are bitten by your dog.
California Homeowners Insurance FAQ: What is not covered by my California Homeowners Insurance?
Water damaged caused by seepage that is not flood related and earthquakes.
California Homeowners Insurance FAQ: What about earthquake coverage?
Earthquake coverage is an additional policy that you will have to purchase. It does cover things differently than your regular policy. Insurance companies are required to offer all earthquake insurance in writing every other year and California insurance laws prohibit companies from rejecting or refusing to renew a policy because the policyholder has accepted the offer of earthquake insurance.
All earthquake coverage must provide coverage for you house, for your personal property for no less than $5,000 or 10% of the cost of the house and for any additional living expenses incurred because of earthquake.
Earthquakes and their aftershocks can cause other things to happen such as water pipe breakage causing additional damage called proximate cause. If you do not have earthquake insurance your regular homeowners policy will not cover these items. The only exception is fire, which is covered under a standard policy.
Earthquake insurance policies must offer $10,000 coverage for reconstruction costs to bring your house up to current building code standards if it has been retrofitted to strengthen against earthquake damage.
California Homeowners Insurance FAQ: How much can I expect to spend on my premium?
Homeowner’s insurance premiums in California vary from county to county as well as insurance company to insurance company. They start at $394 for $150,000 worth of coverage on a new home to $4880 for $750,000 worth of coverage on an older home with the average California homeowner’s premium being $835.
California Homeowners Insurance FAQ: How can I lower my premium?
There are a number of things that you can do to lower your premiums. Simple things such as fire alarms, deadbolts and security systems will help lower your costs. Living in a gated community or being over 55 years old will also lower your premium.
Retrofit Your Home to protect against earthquake damage by anchoring the house to its foundation by seismic bolting, installing automatic gas shut-off valves, and/or reinforcing the fireplace chimney.
Increase Your Deductible. If it’s $250 raise it to $500. Just make sure you don’t raise it so high that you will not be able to cover it.
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