Are You Covered? How to Choose the Right Coverage for Your Home
Buying a home is one of the most important purchases you’ll ever make. Aside from being a place you can raise a family and build equity, you also need to have the right level of homeowner’s insurance.
Unfortunately, not everyone knows what to look for when shopping for coverage.
Understanding the jargon and complexity of coverage can be confusing.
And if since insurance companies strictly adhere to what’s written in their contracts, it’s important to know what level of coverage you have in case if you ever need to file a claim.
Calculate How Much Coverage You Need
Determining how much coverage you need starts with knowing your home inside and out.
Even if it’s your first time buying a home, you need to know about its history.
Inquire about previous claims, whether there was water, fire, or electrical damage.
Also note that newer homes are usually less likely to run into problems, so they may be less likely to insure than older homes.
Comparison Shop
Finding the type of coverage starts with choosing the right company.
While many insurance companies do offer comparable policies, they’re not all the same.
Look for a company that creates specific packages discounts and programs tailored to their clients’ needs.
If may most a little more, but it’s better than having run-of-the-mill coverage.
Understand the Coverage Types
Standard homeowner’s insurance will cover any damage from natural disasters such as fire, snow, hail, and even some types of explosions.
Keep in mind that where you live plays a role in what is covered under your policy.
For example, if you live in a place prone to wildfires or floods, make sure your policy includes a rider that will help rebuild your home if necessary.
In addition, you also need to understand the difference between general, broad, and comprehensive coverages.
These can be broken down into categories: H02, HO3, and HO5. The higher the number, the higher the levels of coverage.
If you can’t afford the highest level of coverage, you do have the option of increasing the deductible or adding a rider.
In cases like these, it’s best to enlist the help of an experienced insurance broker who can explain the different homeowners insurance policies.
The key to finding the right homeowner’s policy is choosing a plan that will give you the most coverage if you need to file a claim.
Take the time to educate yourself about the different types of coverage prior to signing up.
Category: Housing
