ArtsAutosBooksBusinessEducationEntertainmentFamilyFashionFoodGamesGenderHealthHolidaysHomeHubPagesPersonal FinancePetsPoliticsReligionSportsTechnologyTravel

Can I just reduce the amount I have and rely on getting a FEMA check if there is a disaster?

Updated on August 2, 2016

No, you should not reduce the amount of your homeowner’s insurance and count on getting a FEMA check for a number of reasons. The biggest reason not to do that is it is very unlikely that if your house is damaged, it will be damaged because of a disaster. FEMA may provide you money if your house is burned in a huge wildfire or collapses because of a landslide, but the odds are much better that your home will be damaged in a “normal” fire, or that your home will flood because the pipes burst while you are out of town. FEMA money would not be available in either of those situations.

Also, even if your home were damaged in a disaster under which you could qualify for FEMA funds, it’s very unlikely that you will receive an amount that is even close to what you will need to repair or rebuild your home. Recently, the average grant from FEMA was calculated at $5,000. The maximum grant available under FEMA is $32,000. Although $32,000 may be a lot of money, in most cases it’s not much when you must use it to replace all of your possessions or rebuild your home.

Instead of relying on FEMA, you should carefully examine your insurance policy and make sure that you have a sufficient amount of insurance to cover you in the event you suffer a loss. Unfortunately, after a tragedy many homeowners find out that they are underinsured, or that the type of damage they suffered falls under an exclusion to their policy. To prevent this from happening to you, you should review your policy and make sure that the types of losses covered and the amount of coverage available is appropriate for your situation.

Typically, homeowners’ insurance policies cover both hazard insurance and liability insurance. Hazard insurance covers physical damage involving your property and possessions, and liability insurance covers injuries to people on your property or caused by members of your household. Hazard insurance typically covers damage to your property and its contents caused by fire and smoke, wind, lightning, hail, explosions, riots, vandalism, volcanoes, theft, water damage, and other similar events. However, that does not mean that a hazard insurance policy covers everything. It’s very common for hazard insurance to exclude damage caused by flooding and earthquakes, both of which can be important to people in the Oakland area.

Typically, insurance companies do not want to include coverage for high-expense, high-risk types of damage. If you are worried about coverage for any exclusions, you may either be able to add that coverage onto your policy, or buy coverage from another source. For example, it may be smart for a homeowner in the San Francisco area to buy an earthquake policy if their regular policy does not cover earthquake damage.

Once you do have an incident with your home, you may assume that your insurance company will pay for your home to be rebuilt or restored to exactly what it was before. However, that depends on what your policy says. The best type of policy is guaranteed replacement coverage, which will guarantee payment of 100 percent of your repair or rebuilding costs, without limits. Those policies can be difficult to find, however. Instead, you likely have replacement cost coverage, which will give you a set dollar figure, which could be far less than what is needed to rebuild or restore your home. Policies with actual cash value coverage should be avoided.

You should also check your coverage for living expenses and replacement costs for personal possessions. The policy should provide you with compensation for your living expenses while your home is being rebuilt, as well as with money for your personal possessions.

If your homeowner’s insurance is too expensive, it’s critical that you do not get rid of it. Instead, shop around. You would be shocked how much the prices can vary among companies. Talk to an insurance agent about what can be done to reduce your premium.

If you are in the Oakland-Walnut Creek area, and you have had a disaster and you have a dispute with your homeowner’s insurance company, call Robert I. Levy, Attorney at Law, at 510-465-0025. He can help answer your real estate questions and will provide you with a free consultation. You may be able to file a claim against your insurance company for more compensation. Call to learn more.

Comments

    0 of 8192 characters used
    Post Comment

    No comments yet.

    working

    This website uses cookies

    As a user in the EEA, your approval is needed on a few things. To provide a better website experience, hubpages.com uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

    For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at: https://hubpages.com/privacy-policy#gdpr

    Show Details
    Necessary
    HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
    LoginThis is necessary to sign in to the HubPages Service.
    Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
    AkismetThis is used to detect comment spam. (Privacy Policy)
    HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
    HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
    Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
    CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
    Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the googleapis.com or gstatic.com domains, for performance and efficiency reasons. (Privacy Policy)
    Features
    Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
    Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
    Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
    Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
    Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
    VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
    PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
    Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
    MavenThis supports the Maven widget and search functionality. (Privacy Policy)
    Marketing
    Google AdSenseThis is an ad network. (Privacy Policy)
    Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
    Index ExchangeThis is an ad network. (Privacy Policy)
    SovrnThis is an ad network. (Privacy Policy)
    Facebook AdsThis is an ad network. (Privacy Policy)
    Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
    AppNexusThis is an ad network. (Privacy Policy)
    OpenxThis is an ad network. (Privacy Policy)
    Rubicon ProjectThis is an ad network. (Privacy Policy)
    TripleLiftThis is an ad network. (Privacy Policy)
    Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
    Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
    Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
    Statistics
    Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
    ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
    Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)