When it comes to insuring your home, most people don’t have an option. You don’t insure, you don’t get a mortgage, and you can’t buy the house. It is fairly simple. However, when it comes to buying home insurance, the process isn’t as easy as just securing a rate and paying. If you don’t want to just throw money away, you need to be a bit more vigilant in choosing a policy.
You should get to know your policy very well before you ever make a single payment. Your insurance company will give you the details on the policy if you ask. You will need this to ensure you are getting the best deal possible. Here are some specific things you will want to do as you look over the policy.
Check Your Coverage
Coverage can range widely. The most important thing is that you have just the right amount of home insurance coverage. Getting too much is useless and a waste of money. Getting too little won’t help you when you really need it. You have to find that sweet spot where you have just enough coverage.
Looking over the coverage, check details. Look at what exactly is covered. In general, insurance covers items in one of two ways. It either will pay you the appraised value of the specific item or the amount of money it would take to buy that item today. Obviously, if you are in a situation where you would not be able to buy everything you own again, you might want to go with a policy that will reimburse you for the cost to buy anything you lose.
You should also look into the details of what would happen if you have a claim. Some companies will make you buy and replace the lost items and reimburse you what you have spent. Others will send you a check up front. Know how your policy is set up.
You should also know what is covered. Does your policy cover everything in your home? It is common for higher valued goods to require special coverage. This might include things like jewelry and guns. If you own some expensive items, make sure they are covered.
Know Your Deductible
The deductible on your policy is how much you have to pay out of pocket for any loss. Once you pay this amount, your insurance kicks in and pays for you. In general, higher deductibles equal lower insurance policy prices. While it may seem like a great idea to jack up your deductible, you need to make sure you can afford it.
Imagine if your home burnt down and you had to start over. Would you have $1000 to spend out of pocket or would $500 be more affordable? You have to be reasonable. Using the deductible as a way to lower rates is not usually the best plan. So, just make sure it is affordable.
Look at the Discounts
There are always discounts available on any insurance policy. If you don’t see any or you only see a couple, ask about others. Find out what discounts are offered and check to make sure you get all the ones for which you qualify. Insurance agents are usually more than happy to help you save money by ensuring you get every discount possible. You could qualify for discounts for belonging to certain clubs, having a certain membership or even attending a certain school.
Getting a good deal on your home insurance is all about being proactive. You have to take control of the process. Do not just accept the quote given to you without looking over the policy details. Being informed about your policy is the single best way to make sure you are getting a bargain. Plus, you get the added benefit of ensuring your coverage is right.
Categories: Real Estate