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At some homes, you will find structures completeley detached from the main dwelling. These could include a detached garage, a detached garage/studio, or a detached cottage. Typically what you will find is that the limit shown on your policy for detached structures(some companies may use the words other structures or appurtenant structures)represents 10% of the amount of insurance for the dwelling. For example, of the home is insured for $100,000, the Coverage B limit will automatically be $10,000. In some cases, based upon the type of detached structures, such as guest homes or pool houses, the amount you see on your policy for a detached structure may not be adequate. Some polices automatically give 20% of the dwelling limit for Coverage B. If these percentages are not adequate, you might need to buy a specific dollar amount of additional coverage for that structure. Also, if the detached structure is rented out or used for business purposes, unless provided for by a special endorsement, if that structure burns down it will probably not be covered. I know of one homeowner who runs his business from a cottage behind his home. I know another whose cottage is like a small home and it is rented to others. If this situation applies to you and you don't have a special endorsement to cover this situation, you better contact your agent right away. Finally,I have not seen any company that offers guaranteed or extended replacement cost coverage on detached structures. Some companies many also not cover building code changes to detached structures. |
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David Shaffer Mortgage and Insurance Services
