How to Buy Home Insurance
When buying a home, many people overlook the importance of shopping for home insurance. Insurance agents do find it ordinary to get those last-minute phone calls from title and/or escrow companies asking for a home insurance binder. But you don’t have to experience that if you begin searching for the right homeowner policy once a purchase price has been set.
The following are helpful tips to guide you as you shop for homeowner’s insurance:
Determining Insurability
To determine insurability, your insurance agent will want to know things like how old the house and its plumbing and electrical systems are, its location, the type of roof it has, square footage, how many claims were filed 5 years going back, and so on.
If a property is located in a rural area without a fire department or even a fire hydrant on the street, an insurance company may deny coverage. If that is the case, you can approach a specialty or surplus-lines insurance company, but it usually takes longer to get a quote from them.
Deductible Amount
Yes, it’s true: you can save more money if you have a higher deductible on your insurance. In most cases, insurers will offer discounts at a $500 deductible, going up as your deductible rises. The highest deductible you can get with most companies is $10,000, but keep in mind that in most cases, you cannot get a deductible above $1,000. Make sure you and your lender are clear on this before you opt for a higher deductible.
What You Need
In most cases, agents will rely on a cost estimator to know cost replacement estimates. The purpose is to make sure that your house will be sufficiently insured. Take note that insurers do not pay for dirt, so if you bought a property with a huge lawn, don’t be surprised to get coverage for so much less than the price of the house when you bought it. What is included in the coverage is no more than the house itself, land excluded.
Policy Choices
You can actually decide on other options for your home insurance coverage, depending on what you think you need. One is liability coverage, which is usually overlooked. This helps you in the event of claims to property damage or bodily injury. Let’s say you accidentally caused a fire on your neighbor’s property. You might need to live somewhere else, but your insurance will pay that neighbor.
Discounts
Lastly, ensure that you’re actually enjoying all the credits that you are qualified for. Having a home security system that is hooked to a monitoring hub, for example, can instantly fetch you some 10% in discounts. Ask your agent about discounts.