Thanksgiving has passed, Black Friday is old news and Cyber Monday is wrapping up. Any idea what I’m getting at? It means you only have 29 days until Christmas. That’s right, 29 days to finish up (or if you’re like me, start) your Christmas shopping. Yikes!
If this is your first time shopping for home insurance, you probably don’t know what to ask your insurance agent. For the home buying process, getting home insurance is an important step – without it, you can’t close on your loan. But, at the same time, you want to make sure you ask the right questions in order to find the right policy for you. The last thing you want is to feel rushed to make a decision.
Here are questions you can ask to help you find the right policy for you.
Do you offer any bundling discounts?
The best place to start is with your current car insurance. Most of the time they’ll offer discounts for bundling several policies into one.
Can you explain the differences of coverage between your HO-1 through HO-8 policies?
In the U.S., there are eight levels of homeowner’s insurance. They range from basic condo insurance to comprehensive, full-coverage single-family home insurance. It’s important that you understand coverage for each level so you can choose the right one for you.
Do you cover replacement cost or actual cash value?
Typically, policies that cover replacement costs are better because, after paying for a deductible, you’ll receive funds to replace what was lost. With an actual cash value policy, the insurance company will take into account depreciation of the items your filing claims for. Since each company calculates depreciation differently, you may end up with much less money to help you replace items lost during an event.
What is the replacement value of my (future) home?
You’ll be surprised to see that the replacement value of a home may be less than the purchase/appraised value of a home. This important to know since, in the case of a tragedy, you may have to pay for repairs out of your own pocket on top of the deductible.
Does the insurance cover the home and land?
Make sure the policy only includes the home and not the land. If something were to happen to your home, the land will always be there and there’s no need to cover it. Also, removing land coverage may help you save some money.
Are my personal possessions covered? Are there any limits on certain valuables such as jewelry or electronics?
Coverage on personal property depends on the type of policy you have. However, even with the full-coverage policies, you may find that there are exclusions
What is excluded from the policy?
Again, maybe there are certain coverage limits or there may be things that will need an additional or separate policy, like an expensive painting, for example.
Does this policy cover water damage?
Some policies may cover sewer damage, but may not cover flood damage. Make sure you ask if you’ll need flood insurance, as well.
How much is the deductible?
If you’re looking to have lower premiums, you may be able to save some money by increasing the deductible.
Are there any safety features I could install that would help me save money?
Some companies will give you discounts for installing a security system or fence around a pool, for example.
So, there you have it, some questions to help you shop for the right homeowner’s insurance for you and your new home! We hope you find these helpful.