Buying a home means considering a broad range of different options: How many rooms will be in the house? Which city and neighborhood will you live? How will you structure your mortgage? Understanding and organizing these attributes is crucial before the buying process, especially considering the major investment you’re making.
One area where you simply can’t afford to gloss over details is your homeowner’s insurance policy. Failing to understand your policy package before you sign on the dotted line can lead to an array of potential consequences. When you’re shopping for homeowner’s insurance, here are a few details that should be double-, and maybe even triple-checked before finalizing.
1. Update Your Policy If Any Changes or Renovations Take Place
Renovations and homeowner’s insurance are closely intertwined. If you plan on doing any remodeling to your home after you buy, talking with your insurance agent beforehand to help you understand how it will impact your insurance rates. If you’ve already conducted renovations in the home, it is crucial to disclose this to the insurance company and update your policy accordingly. Not doing so will leave these new additions vulnerable to potential damages.
2. Make Sure Pets Are Precisely Accounted For
Putting down the right information about your pet could be the difference between a full comprehensive policy or getting dropped by your insurance company. Dog bite and dog-related injuries make up one-third of homeowner’s liability claim dollars paid out, and insurers have become extremely cautious when it comes to dog liability coverage.
Some of these companies will outright deny policy options for homeowners who own a specific breed. For example, insurers may be hesitant to cover Pit Bulls, Rottweilers and German Shepherds. Disclosing accurate information about any pets is vital when getting your policy, as it can help you avoid being underinsured or losing your policy altogether.
3. Determine Exact Worth of All Valuables in Home
Many homeowner’s insurance plans cover losses in the home that occur as a result of robbery, theft, or natural disasters. Since your insurer will likely determine the amount paid out to you based on the information you provide to them about valuable items in the home, having a precise account of these is important when the time comes to be compensated.
Make a list of all the valuable items in your home, double-checking to ensure nothing is left out, and determine the dollar amount for each. Give this list to your insurance agent when determining your coverage to avoid any miscommunication in case damages or theft does occur. You can supplement this list with pictures and video proof.
4. Getting Enough Coverage on Your Policy
The home-buying process is not only extensive, it can also be expensive. In an attempt to keep costs low, some homeowners may decide to reduce the amount of coverage in their plan, leaving the well-being of their home up to chance. The little bit of monthly savings does not outweigh the costs if an uninsured area of your house is damaged, and may have you paying out a significant amount in repairs.
If the premiums are a point of concern, it may be time to compare homeowners insurance quotes online to see how different companies vary in price when it comes to coverage. Shopping around and comparing insurers can help make sure your costs remain low without sacrificing comprehensive coverage.
5. Purchasing the Right Kind of Coverage
In addition to having enough coverage in your insurance plan, the specific kind of coverage you attain is another key detail. Depending on the location of your home, weather patterns in your area, and vulnerability to various types of damages, the type of policy you purchase will vary.
For example, if your home is in close proximity to an ocean or lake, it is likely in your best interest to add optional flood coverage in case of water damages. Or if you live in an area where earthquakes are a possibility, including an umbrella on your policy can protect against the natural disaster.
When it comes to your homeowner’s insurance policy, having an accurate grasp of the details is essential to protecting your home and your family. If you fail to disclose this information to your agent, it may leave your home vulnerable to potential damages, and your insurer could drop you for your dishonesty. Before finalizing your insurance policy, make sure to account for all the specific factors required by insurers to ensure that nothing is left up to chance.