​It is important to understand exactly how your homeowner’s or business owner’s insurance works and what it covers before you have a need to file a claim. After a fire occurs is a bad time to discover that your fire insurance will not pay for certain types of damage. Before you need to file a claim, examine your home or business property insurance policy carefully and learn what damage will be covered and what you must pay for yourself.

J&M Keystone, Inc., a damage restoration specialist in San Diego, can work with most homeowner insurance policies. When a fire strikes, it is good to know that J&M Keystone, Inc. will take care of not only the cleanup but the fire insurance company’s requirements as well.

Types of Homeowner’s Insurance

​Many people do not realize that fire insurance comes in more than one form. According to the Insurance Information Institute, there are several ways home or business owners can structure their fire insurance coverage.

One type of policy is known as an actual-cash-value policy. This type of insurance will pay the original price of what is lost in the fire less depreciation. This means that you will not receive the full replacement price of the items; instead, you will receive the amount these items would bring on the open market if they were sold as is. It can be difficult to determine the value of some items, so insurance companies often use standardized lists of items to determine how much they will pay.

Another type of policy is a replacement-value policy. These policies are more expensive but they provide the money to replace everything in the home with new items. These policies are very popular because they guarantee that a homeowner who suffers loss in a fire can replace the objects that were destroyed no matter what their cost.

Finally, guaranteed or extended-replacement-value policies cover replacement costs that exceed the total of the coverage. In most cases, homeowners are asked to set a limit for their home and contents. If the limit set is too low, the guaranteed-replacement policy will cover the difference. This is a particularly useful policy if the price of replacing items goes up over time.

Homeowner’s policies cover both the building and the contents against damage from fire. Most insurance companies suggest setting your contents coverage limits between 50 and 70 percent of the price of the building replacement. In other words, if your home is covered for $500,000, you should have at least $250,000 worth of contents coverage. Insurance companies also suggest that if you have an item that may be particularly valuable, such as a diamond ring or a rare book collection, that you insure it separately to be sure you receive full value if it is destroyed.

Finally, many homeowner’s fire insurance policies cover living expenses while the home is repaired. Rent, food, transportation and other costs may be paid, often up to about 20 percent of the face value of the policy. You can also increase this amount if you wish.

Limitations to Home and Business Fire Policies

​Both home and business fire policies can be limited by certain exclusions. These are the important parts of an insurance policy and it is critical that you understand them. For example, your home fire insurance policy may cover all types of damage and restitution, but may pay nothing if the fire is caused by arson committed by a family member.

Another important limitation to address is the changing value of your home. If you add on to your house or if construction costs rise significantly, it is important to amend your policy to reflect the new amount you will need to rebuild. During 2003, California wildfires caused many homeowners damage that they discovered, too late, was not covered by their policies.

There can be many limitations to home and business fire insurance policies, so it is very important to read your policy carefully and ask questions of your insurance agent if you are not sure about your coverage.

J&M Keystone, Inc Works with Insurance Companies

​J&M Keystone, Inc., a San Diego fire restoration specialist, can work with your insurance company to file a claim for damage and receive payment for your fire damage restoration and cleaning. J&M Keystone, Inc. has been working with insurance adjusters and others for nearly three decades and understands how to deal with insurance claims and coverage.

If your home or business is damaged by fire, it is critical that you receive immediately cleanup and service to prevent further damage. Contact J&M Keystone, Inc. 24 hours a day, 7 days a week for professional fire and water damage restoration services. We will work with your policy limits and help you receive the right cleanup for your needs to protect your property and salvage as much as possible.