How Riders Work And Why You Might Need Them With Homeowner's Insurance

The reason people purchase homeowner's insurance is for the protection of their homes. Home insurance protects houses from perils, such as fires and vandalism, and it provides a way to receive compensation after damages occur. Homeowner's insurance has limits, though, of what it protects. You can, however, purchase riders to fill in the gaps. A rider helps you cover things that your regular policy does not fully cover, and here are a few things to know about riders on your plan.

Riders Are Add-Ons

Some insurance companies call these riders; others call them endorsements. In either case, they mean the same thing. They are add-ons to a policy. They allow you to add coverage for specific things you own that your regular policy does not cover.

When you add riders to your plan, you will pay for them. Each one will have an extra cost, so your premiums will increase after adding them. Typically, though, riders do not add significant costs to policies.

Reasons You Need Them

While there are people who may not need any riders, most people need some. The most common reason to purchase them is to add coverage for items that are not adequately protected with the plan you have. For example, your insurance policy might offer $1,000 coverage for jewelry. If all your jewelry is worth less than this amount, your policy has enough protection for you. What happens if you own $10,000 worth of jewelry? In this case, you should add a rider to your policy to cover the additional $9,000 that your current plan does not cover. If you do not add a rider and lose all your items to a fire, you would only receive $1,000 in compensation, even though you lost $10,000 of jewelry.

How to Add the Right Ones

If you are not sure if you need riders for your policy, ask an agent. An agent can ask you questions about the things you own and make recommendations based on your answers. If the agent suggests a rider for something, you should consider adding it.

Do you have homeowner's insurance right now? If so, when is the last time you updated your policy? You should aim to update it every year as this helps you have the proper coverage for all your risks and needs. To learn more about home insurance and riders, call a home insurance agent of your choice.