Purchasing Home Insurance Top 10
Top 10 considerations when purchasing home insurance
1. You Need Home Insurance
Homeowners need to purchase home insurance to protect their homes and personal property. Those who rent need insurance to protect their furniture and other personal property. Protect against liability for accidents that injure other people or damage property.
2. Determine How Much Coverage is Needed
Your lender may determine how much coverage is needed on your home. It is important to note that the amount of coverage you buy for your house, contents and personal property will affect the price you pay.
3. Compare Deductibles
Make sure when choosing a policy that you are comfortable paying the deductible if you make a claim. Remember, a policy with a $1000 deductible will cost more than one with a $2500 deductible. Higher deductibles may be available at a reduced price.
4. Replacement Cost or Actual Cash Value?
You have the option to choose to insure your home and belongings for either replacement cost or actual cash value. Replacement cost is the amount it would take to replace or rebuild your home or repair damages with materials of similar kind and quality, without deducting for depreciation. Actual cash value is the amount it would take to repair or replace damage to your home after depreciation.
5. Shop Around
You are not required to purchase insurance from the company your lender or realtor recommends. Shop around and find an insurance agent you are comfortable with and has programs for your specific needs.
6. Ask for Discounts
Many insurance providers provide discounts if you have multiple policies with their company. Ask your agent about discounts for proximity to fire station, deadbolts, security systems, type of roof and any thing else that comes to mind.
7. Basic Coverage Available
Basic insurance programs can consist of Fire, Windstorm, Flood and Theft, Each package protects against a specified number of events that cause damage to property. In addition, each package policy may contain four additional types of coverage: property damage, additional living expenses, personal liability and medical payments.
8. Where to Shop
Shop around, ask friends and neighbors for referrals. Meet your agent and get quotes. Thinking of purchasing a new home call your agent and get a quote.
9. Read Your Policy Carefully
You should be aware that a home insurance policy is a legal contract. It is written so that your rights and responsibilities as well as those of the insurance company are clearly stated. When you purchase home insurance, you will receive a policy. You should read that policy and make certain you understand its contents. Keep your policy in a safe place and know the name and number of your insurer. Add the name and number of insurer to your mobile devices.
10. Review Your Insurance Coverage Annually
Check with your insurance agent at least once a year to make sure your policy provides adequate coverage. The addition of a room, new insulation or remodeling add value to your home and therefore may increase replacement cost.
