You’ve spent months searching for the perfect house and you’re about to close on your new home. But before you do, your lender will require you to buy homeowners insurance. Don’t rely on the most basic coverage. Shop around, compare rates and set priorities for what needs to be covered. Make sure you have the best protection for when the unexpected happens.
- Determine your priority for coverage
Before you get insurance quotes, know that there are different types of coverage for structure, possessions, living expenses and liability. There are also various levels of protection based on the needs of the homeowner and the type of residence. For instance, an actual cash value covers the house plus the value of your belongings, but at what the items are worth now after depreciation. A replacement cost would allow you to rebuild up to the original value without the depreciation.
As a first-time homebuyer, figure out if price, service or level of coverage is the most important. The least expensive policy often means fewer protections and more out-of-pocket expenses when filing a claim.
- Don’t confuse the market value with replacement cost
Your home insurance coverage should cover the cost of rebuilding your house. If you’re using the market value to insure your house, you may be overinsuring it, or overpaying, for insurance. On the other hand, you don’t want to underinsure your home and take on additional risk by purchasing less coverage. The good news is you can always talk to a team of experts and let them help you calculate the replacement cost.
- Ask about discounts
There are several discounts available you may qualify for as a homeowner. This includes installing a security system, adding home protections, setting up automatic payments and bundling home and auto insurance. Bundling multiple policies from the same insurer is an easy way to save money on annual premiums, and is convenient. You simplify policy management and will have less paperwork to deal with. We can help you shop around and compare options to find the most affordable and competitive rates.
- Find out what your policy doesn’t cover
Understanding what your insurance does not cover as a homeowner is just as important as knowing what is covered. It will help you determine whether you need to purchase additional coverage. For example, most standard policies do not cover damage caused by rising waters, so would have to buy a separate flood insurance. Typical policies include dwelling, living expenses, personal property and liability coverage which covers a range of perils. One of our reps can answer your questions about what’s excluded based on your area.
- Make sure valuable personal property is covered
If you own jewelry, collectibles, antiques, artwork or other valuables, you may need to take special precautions to keep those items safe. Think about how much coverage you would need to protect those prized possessions in the event of a natural disaster, fire, vandalism or theft. Consider raising the limit of your plan’s liability, or ‘scheduling’ specific items for broader coverage without a deductible.
Comprehensive coverage to ensure your home and contents are fully protected comes down to knowing you have received the coverage you need. Know which items need separate riders, and carefully read your homeowners insurance policy to make sure you understand what’s covered and what is not. As an insurance group that works with multiple providers, you can view us as a one-stop-shop for comparing policies and finding a plan tailored to your specific needs.