Everyone who owns a home needs a way to protect themselves from all of the potential things that can go wrong with your home. You never know when a window will break, when black mold will show up, or when your foundation starts to crack! Your home can be a ticking time bomb of financial problems, and you want to make sure there’s money there to take care of these types of problems when they do arise. Fortunately you can do that by purchasing home-owners insurance. Make sure you’re smart about buying home-owners insurance so that you don’t waste money or get stuck in a bad policy.
The first thing you’ll need to do is figure out how much coverage you want on your home-owners insurance. You’ll want enough to cover your home and the items in your home. After you’ve got a value in mind, go out and shop around for prices. You can do this by visiting an independent agent who will search among several different insurance companies and find you the best deal. You might be able to get an even better deal by going with the same company for both your homeowners and auto insurance.
When looking at policies, only consider ones that are replacement-cost insurance. Many policies now only pay you the amount of money your home was originally insured upon, not the actual cost of replacing your home. This has been a major problem for homes that have gone up in value the last few years. Many consumers bought their policies before the real-estate boom and then the price of their homes went up significantly, and now they don’t have sufficient coverage to replace their home. By getting replacement-cost insurance, you will be able to replace your home and belongings regardless of what the original value of the insurance on your home was.
You’ll want to get a policy with a fairly high deductible, because if you use your policy too often, insurance companies are likely to cancel your policies or raise your monthly premium. It makes a lot more sense to get a higher deductible policy and only use it to take care of large ticket items and then just pay for the smaller items out of your pocket with the money you save by getting lower deductibles.
Be sure to ask your agent what sort of documentation you need to substantiate a claim in the event that a theft occurs or if there’s a fire. An easy way to document the stuff in your house is to walk around with a video camera and describe your possessions. Be sure to store this tape somewhere other than your house!
About every five years, you’ll want to update the value of your home on your insurance policy and the contents that you have in it. Also be sure to carry enough liability coverage on your home in the event that someone becomes injured on your property.
Getting quality home-owner’s insurance is a great way to protect yourself from all of the things that just happen related to your home, but make sure do your due diligence when picking out a policy for your home.