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Home insurance you need
Have you thought about replacement costs? Sewage backup? There's more to coverage than meets the eye.
By Gerri Willis, CNNMoney.com contributing columnist

NEW YORK (CNNMoney.com) -- Getting the enough insurance coverage for your home is the only way to protect your most valuable asset. In today's tips we're going to tell you what you need to know BEFORE a storm strikes.

1: Get the bottom line

A lot of people have what's called cash value insurance. That means that if you have a loss, you may not get the money that you need to fix your house or buy new furniture.

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This policy means your insurer is going to give you something less than what you paid to buy the content in the first place because they take depreciation into account. Depreciation is the amount of money that they say makes up for the wear and tear.

If you want the full value of what it would cost to replace your items, you'll need replacement cost insurance. It's priced at about 10 percent more.

2: Account for shortfalls

Nearly 2/3rds of homes are insured for less than their value. Don't get caught shorthanded. With construction and material costs up about 8% since last year, you'll want to factor in these rising inflation costs. Make sure your insurance policy has an inflation guard. This way the value of your home will be adjusted to account for these rising prices. And if you've made any improvements to your home, be sure to tell your insurance company. Whenever you add value to your home, you'll want your insurance to reflect that.

3: Prepare for water hazards

If you live in a flood zone, getting flood insurance is a no-brainer. For the rest of us, it's still a good idea considering that homeowners are 26 times more likely to get hit with a flood rather than a fire.

But flooding isn't the only wet situation you'll want to protect yourself against. Backups of raw sewage through the drains in your home can be a very costly - and disgusting - problem. Homeowners policies don't cover sewage backup. You can buy extra insurance for sewage backup from your insurance company. The cost is about $40-$50 a year.

4: Cover your codes

If you live in an older home or in an area that has an older infrastructure or your community is prone to disasters, you may want to consider insurance that will cover the cost of rebuilding your home to meet building code upgrades and construction regulations. It's called purchase ordinance and law coverage.

5: Get the lowdown on your living expenses

If your home is damaged to the point where you can't live there for a while, your insurance should pay for your hotel room and meals. If you live in an area that has seen widespread devastation, like New Orleans, it could take quite a few months or even years before you can return to your house.

You want to get all the details about this living expenses provision. Some policies may cover expenses only for six months. Other policies will cover expenses up to about 20% of the insurance on your house. In most cases, you can increase this coverage for an additional premium.

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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2014 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2014. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2014 and/or its affiliates.