Home Owners Insurance and Divorce: An Unfortunate Combination

By Rafael Onak, InsuranceAgents.com Staff Writer

As Judge Toler explicably portrays on “Divorce Court,” every weekday, divorce is no laughing matter.   This FOX TV favorite, produced in Los Angelos, CA focuses on the trials and tribulations of ending a marriage.  With more than 50% of marriages ending in divorce, it is imperative you know how to deal with certain aspects of your life following the event. One such overlooked detail, home owners insurance. A substantial life change such as divorce forces you to reassess your finances and your home owners insurance should be an integral part of that reassessment.

* Remember:  Most home owners pay for their home insurance rolled into their mortgage payment.  Understanding a reassessing cost as it pertains to your new financial situation is always recommended.  If you're going through a divorce or planning one, make sure you have all situations calculated.  Get free home insurance quotes to compare, today.  It can help you with dealing with the inevitable financial circumstances that come with a divorce.

If you plan on keeping the home following the divorce, your number one priority is to change the home owners insurance policy to your name. You will also want to review your coverage to make sure your policy is up-to-date. Home owners insurance policies comprise of either actual cash value or replacement cost coverage for your contents.

The difference between the two is considerable, so be sure to familiarize yourself with each:

1. Cash Value Home Insurance.The most common way of determining the amount of reimbursement for a loss, actual cash value is what it will cost to replace an item at the time of the loss after subtracting depreciation.
2. Replacement cost coverage. Just as it sounds, replacement cost coverage is the cost to repair or replace an insured item.

Don’t forget to also check on your deductible. Remember—a lower deductible translates into a higher premium while a higher deductible saves you money on your home insurance policy. Depending on your situation following the divorce, each type of deductible may have different benefits for you.

Reassess Your Home Insurance

Ending a marriage affects every aspect of your life. On top of an enormous emotional toll, divorce forces you to reassess every component of your personal finances, particularly home owners insurance. If you plan on keeping the home after the divorce, it is imperative you follow the guidelines to ensure a convenient and stress-free process. Divorce can be an inexpensive dispute, but that doesn’t mean your home owners insurance policy has to as well.

Published: Tuesday 6th October 2009