Finding the homeowners insurance policy that’s right for you can be a challenging and confusing process. There are many variables to consider and comparing policies isn’t always comparing apples to apples. Add to that the increased pressure to obtain coverage before your closing date, and it’s easy to see why people make mistakes when buying homeowners insurance. Here are a few considerations to keep in mind when you’re searching for insurance for your new home.
Setting the right deductible
Your deductible is the amount you have to pay before your coverage begins. Generally, the higher your deductible the lower your premium. It is important to find the balance between the amount you can afford to pay versus the amount you could save on lower premiums. Setting your deductible too high may leave you vulnerable should a disaster strike.
Dismissing add-on protection
Most standard home insurance policies protect you from natural disasters, such as fires, hail and wind, but water damage from floods or sewer backups, as well as earthquakes and sinkholes are often not covered. Be sure to analyze your risk carefully before deciding pass on these add-on coverages.
Confusing replacement cost with value
Your home should be insured for the amount it would cost to replace it from the ground up, not the value of your home. What’s the difference? It may cost more to build your house from scratch than what your home is actually worth, especially if construction prices have gone up, property values have gone down, or if you have a lot of upgrades in your home.
Forgetting to cover specialty items
Account for all your high priced valuables and make sure they are covered. High end jewelry, collections, and other specialty items may be excluded from standard policy coverage and require additional riders.
Shopping only by price
It is tempting to compare policies based on price alone, but resist the easy way out. Weigh the pros and cons of each policy, research the company’s reputation, and compare the amount of coverage you get for the premium you pay.
We work with hundreds of insurance providers and can not only gather custom quotes for you, but help evaluate which company and policy is right for you. Contact us online or call 804-751-0600 to get started today.