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Insurance foolishness: Homeowners insurance

7 ways you're being foolish with insurance
Homeowners insurance © JohnKwan - Fotolia.com

No foolin': Your homeowners insurance or renters policy probably doesn't provide enough protection for your most valuable belongings.

"Standard home insurance covers damage to your computer by fire or an explosion, but the reality is that you're more likely to spill a drink on your keyboard or drop your iPad," says Dodge. "A rider on your insurance policy can cover your computers for a low premium."

You also should get a rider to cover the full value of any expensive jewelry, collectibles or art you own.

"You should ask your insurance agent about special coverage for anything your neighbor doesn't have," says Tom Bigoski, owner of the Thomas Bigoski Insurance Agency in Gainesville, Va. "If you have an antique grandfather clock, high-end jewelry or artwork, you need to purchase extra coverage for that."

And if a fire or other disaster destroys all your possessions and the home itself, your homeowners insurance policy should be big enough to rebuild and replace everything. Some homeowners foolishly think they need only enough insurance to cover the current market value of their property.

"Many times, the cost to rebuild or repair a home is more than its market value," says Ron Moore, senior product manager for MetLife Auto & Home in Minneapolis. "The amount of home insurance you have should equal the replacement cost."

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