Purchasing a home owner’s insurance policy is an essential part of securing a home loan. It can be confusing to understand how much coverage you need, and which company will best suit your needs. In this article, we will discuss some of the aspects of home owner’s insurance. We will also help to clarify some of the confusion, by providing a few user-friendly tips.
It’s crucial to have homeowner’s insurance. If you don’t have it, then natural disasters or thefts can ruin you. If you carry a mortgage, you are most likely required to have a homeowner’s insurance policy. They are usually required per the loan terms.
To make sure that you are paying the lowest amount on your homeowner’s insurance, compare the cost of your insurance policy to another company’s policies at least once a year. You should also review your existing policy and mark any changes that may have occurred which could lower your premium.
Before you buy a home, find out how much insurance runs in the area you are considering. In some locations, homeowners insurance is very high due to a number of factors. For example, if the home is located in a flood zone or an area where hurricanes are to be expected, high insurance rates are also to be expected.
Certain things in your home will affect the cost of your insurance policy. For example, owning a pool will increase your insurance costs, due to the increase in liability. Circumstances beyond your control, such as how far your home is from a firehouse or fire hydrant can also raise your homeowner’s insurance costs. Keep this in mind as you shop for a home.
When buying a homeowner’s insurance policy, what is excluded from coverage is sometimes more critical that what the policy does cover. Flood coverage, for example, is not typically covered in most homeowner’s policies, but can be purchased as a separate policy. The same is true for other natural disasters such as earthquakes.
Before a flood strikes, you need to know what to do to be sure that your home is insured against floods. The only way to insure against the risk of floods in the US is via the National Flood Insurance Program (NFID), administered by FEMA. Insurance companies work with FEMA to sell coverage to homeowners. Therefore, always have a plan in place to cover flood protection, and know whom to contact at your insurance company in order to arrange for it.
Consider asking your insurance agent for a home owner’s policy review once you reach the age of 55. Senior citizens often receive a discount. Find a company that does if yours does not.
Always get the “guaranteed replacement value” stipulation in your policy. This gives you the cost of a full rebuild of your home, regardless of what destroyed it. One of the best benefits of this is that even if inflation occurs in the construction market, the insurance company will be the one to bear the extra costs.
There may have been changes to your neighborhood that could decrease the premiums that you pay for your home insurance. Certain changes, such as a nearby fire station or fire hydrants, could decrease your premiums. Learn about what’s being added near you, and talk to your insurer about it.
A well installed security system provides an excellent and useful way to lower your insurance costs. You will get peace of mind, and most likely, a discount for your homeowner’s insurance policy. You become a lower risk if you protect your home, thus significantly lowering your premiums. In time, you will have saved enough on your premium cost to pay for the system itself.
Unexpected Damage
Having homeowners insurance can save you a great deal of money should your house ever experience some unexpected damage due to a natural disaster or other random cause. If you have your home insured, it will provide money for the repair costs from unexpected damage that can come with owning a home.
Look for an insurance policy with a guaranteed replacement value, to ensure you don’t wind up in a smaller or less expensive home than the one you insured. Such insurance covers the full cost of a rebuild on par with what was lost.
Make sure that every exterior door on your home has dead bolt locks. Depending on your insurance provider, this might lower your home owner’s insurance premiums slightly. They also make a great deterrent against would be thieves or other intruders. They are inexpensive to install and a great way to keep your home safe.
Purchasing a home owner’s policy is a necessity, especially if you will be financing your home purchase. The process can be confusing however, and navigating the insurance industry, sometimes proves difficult. In this article, we have provided you with a few tips that should help you in making your selection. Follow these tips to simplify the process of purchasing your next home owner’s insurance policy.
Think about raising your deductible if you want to lower your annual premiums. Research before acting, as small claims can cost you more money and you’ll have to fix them and pay for the damage.