Any homeowner, and even non-homeowners know what Homeowners Insurance is. Like insurance of any kind, Homeowners Insurance is a source of protection. In your home’s case, it is protection against the unforeseen bad things that can happen to a home, like burglary or fire. Also, like other insurances, there are different levels of insurance that can be customized to your needs and your budget.
Your home is no different than your car. While it is still under lease or in this case, mortgage, insurance is required. A bank or mortgage lender wants to ensure, that while they still are invested in the property, they and their investment, as well as the borrower, are protected.
You don’t have to purchase it, but as long as you owe on the home the lender can get it and bill you. This is not the optimal condition because then their interests are the priority and not yours. It’s just good logic to seek and purchase it yourself to make sure you not only have the coverage, have a sufficient amount, but also that anything you feel is necessary for you to feel secure that all of your interests are protected.
So, what do you need to know in order to make sure you have the right insurance for your home? Here are just a few vital things for your consideration:
- Decide how much you need. Now is not the time to get cheap! The better your coverage, the less you will have to pay out of your own pocket if disaster strikes. In some cases, your lender decides how much coverage you need and may require you to buy a policy that covers at least the amount of the mortgage. 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.
- Based on geography, consider add-ons are needed. You may get a basic policy but feel you need to be protected against certain instances. Ask questions of your realtor and lender about the different outliers that exceed a basic plan that may be prudent add-ons to your policy.
- Shop around. We can’t say it enough, DO YOUR HOMEWORK! Check reputations, consumer reviews, and word of mouth before deciding on an agency or a policy. You ARE NOT required to buy insurance from the entity your lender recommends. While there may be no cause for concern, just know that they have a relationship that means they may refer that agency, regardless of being the right fit for you.
- Ask about discounts. In some states, insurers offer lower prices for such things as insuring your home and car with the same company, installing deadbolt locks or alarm systems or replacing the roof. There are also many companies that offer discounts for demographic groups like military, veterans, and senior citizens.
- Review your needs, yearly. Knowing when your needs change is just as important as having insurance in the first place. You see car insurance commercials where seniors advise that they’ve had their insurance for years, and realize it may be time for an upgrade. Things are constantly changing. You may be able to afford better coverage, require an add-on, or are eligible for a discount as things change in your life. Stay up to date with the best policy for you by vigilant to your needs and how they change, annually.
Just because Homeowners Insurance is something you have to have and there are a myriad of places to buy it, doesn’t mean that every place or every policy is right for you. Do your research and make the best decision for your situation. Protect yourself and one of the greatest investments you will ever make!
