New Home Owner? What You Need to Know About Insurance

Category: Personal Insurance

Buying a home for the first time is an exciting, yet overwhelming process. Suddenly you need to be fairly expert at things you have never dealt with before, and you find yourself worrying about other things you may have never considered as a renter. Home insurance is often confusing and frustrating for those unfamiliar with it. How much do you need and what does it cover?

First, determine how much property insurance you will need to adequately cover your new home. Most buyers have an idea of what the market value of their home is, but what would it actually cost to completely rebuild your home if it were destroyed by fire or severe weather? A certified and qualified builder in your area should be able to give you an estimate. That cost should give you an idea of how much property insurance to carry.

Most insurance companies set the limit on the contents coverage (everything you keep inside your home) at a percentage of the property insurance coverage, typically 75 percent. For example, if your home costs $200,000 to rebuild, the insurance company will cover $150,000 worth of contents. However, some contents, like firearms, jewelry, valuable artwork and coin collections are limited to anywhere from $1,500 to $2,500 in coverage. If you have many of the often excluded contents from basic home insurance policies, it’s a good idea to consider purchasing riders or additional insurance to protect those belongings.

A standard home insurance policy will not cover flood damage, earthquake damage and some types of hurricane damage. Each of those events requires additional policies. Like any product, not all insurance policies are the same. Many policies differ from company to company and most insurers have varying levels of protection from which to choose. Many times the cheapest policy isn’t the best policy and can end up costing you more in the long run when and if you need to file a claim.

The best way to find the perfect home insurance policy is to contact one of our knowledgeable, independent insurance agents. We can identify your insurance needs, suggest coverage options and help you compare several quotes from a variety of insurance companies, ensuring the policy you buy offers comprehensive coverage at the most affordable rates. Contact us to help make home ownership just a little less overwhelming.

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