For nearly everyone, their home is their most expensive personal purchase. That’s why if you’re buying a new home, you have to make sure you also don’t neglect getting sufficient home insurance coverage. This policy can pay for repairs for the home, unattached structures such as a barn, and even your personal property inside the house. It all depends on whether the cause of the damage is by a covered peril in your insurance policy.
Here are some tips that can help you out.
- Before you buy a house, check the claims history. You can ask the seller to provide the claims history report, as the current homeowner must buy this. This report may indicate certain problems that you may not have known before. You have to take into account potential problems like water damage, which can make it more expensive or more difficult for you to get home insurance later.
- Determine the right value. When you insure your home, it’s not about how much you paid for it. Instead, you have to consider how much it will cost to rebuild the home when it’s damaged by a covered peril such as a fire or a flood. Since the insurance doesn’t cover the land, the amount of the policy may not equal the value of the house and lot. However, you have to factor in inflation and the costs of bringing repair materials to your site.
- Make sure you understand what’s covered in your home insurance. You have to get the insurance agent to walk you through the various points of the policy, including which types of perils are covered, and which structures are also apart of the coverage. You need to know which types of disasters aren’t covered, and whether the insurance company will also cover your garage or your appliances inside the home.
- Find out about special coverage. Usually, these policies tend to cover fires and lightning strikes, as well as hail and wind damage. They may even cover any losses that can result from theft and vandalism. But they may not cover things like earthquake damage and flooding.
That’s why you need to do some research as to how likely it is that you will need special coverage that are not part of the core coverage. Then you can check whether these coverage options are available. Many owners often consider additional coverage for mold damage and water backups.
- See if your location can provide premium discounts. Homes in some neighborhoods may cost less to insure because they have a professional fire department in the neighborhood, instead of just a volunteer group. You may also end up paying less if your house is right near a fire hydrant.
- Find out other factors that can reduce the premium payments. Are your plumbing and electrical systems new? If they’re not more than a decade old, then they may cost less to insure. See how much you save on insurance costs if you install deadbolt locks, burglar alarms, and smoke alarms. These may cost some money at the start, but you can save a lot on insurance as well as on potential repairs. You can raise the deductible to a thousand dollars to reduce your premiums, if you can afford that kind of cost.
With the right home insurance coverage, you can at least rest easy knowing that you’re covered for the most likely problems. So if disaster strikes, you’re at least assured that you won’t shoulder the entire cost of repairs—or even a complete rebuild.