Home insurance is a necessity that every homeowner must be prepared to sign up for, often before they can even close the deal on purchasing a new property. The question isn’t “if” you’re going to get coverage, but rather “what” your options are to make sure you get the right kind of policy when it comes time to choose an insurer. There’s a lot to take in and several details to nail down when you’re a first-time home buyer, and acquiring home insurance definitely needs to be added to the to-do list. A few basic guidelines should help you to get started so you’re comfortable in knowing what questions to ask your agent.
Get Adequate Coverage
This sounds like a no-brainer, but often times homeowners don’t realize all the things they should have had covered under their policy until it’s too late. Standard policies have certain monetary caps when it comes to replacing personal belongings, rebuilding a home, rental expenses, liability and any medical costs that are involved in a claim. You will want to go over those numbers carefully, and if they don’t seem to add up to what you’ll actually need should you ever have to file a claim, you may want to consider additional coverage rather than run the risk of being stuck with major out-of-pocket expenditures.
Negotiate Discounts
They are plenty of discounts out there to be had if you are aware of what to ask for. Saving on your home insurance premiums will make you a much happier home owner. Inquire about things like installing smoke detectors and alarm systems, any plans you have for renovations, the location of the property and multi-policy rates.
Revise Your Policy
Standard home insurance policies usually cover a long list of damages and hazards but certainly not every potential catastrophic situation. So if you know that you live in an area where you can’t count on the weather to be calm, the location is prone to earthquakes or fires or you’re purchasing an older home with questionable plumbing, it could be a good idea to customize your policy and pay a little more to add coverage that will include high-expense destruction like flooding, sewer backups, etc. It is also very important to make sure that you are educated about what to do when disaster strikes.
Select a Deductible
A lot of people choose a lower deductible rate when they sign up for home insurance because they think they’re saving more money should they ever have to file a claim. While in one respect this is true, it can also be more beneficial to actually choose a higher deductible and significantly lower the premium costs you’re paying each month.
Take Inventory
Protecting your personal belongings should begin before disaster strikes. When it comes time to make a claim you will have to show proof of the items you owned and their worth. It’s almost impossible to do that once they’ve already been destroyed. To ensure proper compensation, do an inventory of all your valuables and collectibles and keep an itemized list along with photos in a safe place. Then go over the amount of coverage you’ll realistically need with your agent.
Making sure you have full protection from the start of your new home insurance policy will give you peace of mind and lessen the risk of astronomical out-of-pocket expenses to rebuild your home and replace your possessions.
Photo Credit: Flickr/andrew steinmetz
