What You Should Know About Buying Home Insurance
Buying a new home can be an exciting but overwhelming process. First time buyers have a lot to consider, so it can be easy to imagine why they give little to no thought to home insurance – but, should something happen in their home, it will be an all too stark reality that this insurance should have been more of a priority. Before signing on the dotted line, make sure to review these three important pieces of information regarding homeowners insurance and getting the best deal.
Compare Coverage from at Least Three Different Providers
For those purchasing their home using a mortgage, it will be almost guaranteed the mortgage lender will require the buyer to have homeowners insurance and possibly additional coverage like flood insurance. Since there is no requirement as to whom to purchase this coverage from, make sure to compare coverage and prices from a few different providers to ensure you are getting the best possible coverage and the coverage required for a great, affordable price.
Escrow Insurance Payments with Mortgage Payments
Most homeowners tack their homeowners insurance payment onto their mortgage payment when they send in their check. During this process, the mortgage lender will pay the home insurance and generally the property taxes from the escrow in the home. Many mortgage providers prefer this method of payment because it ensures that the homeowners insurance premiums are being paid for the property. When purchasing a home, you will generally need to make the first year’s insurance payment, so make sure to bring information about the homeowners policy and the money to the closing.
Get Enough Coverage
The most important part of choosing a home insurance policy is making sure you are getting the right amount of coverage while also avoiding paying for more than is needed. It is never a good surprise to receive when something happens at the home and the insurance does not cover it or to discover after paying the premiums that what you are paying extra for is not even required.
Here are some of the common levels of coverage:
HO-2 – Protects only against instances outlined in the policy
HO-3 – Protects against all instances except listed exceptions
HO-5 – Protects well-maintained, newer homes from all instances except listed exceptions
HO-6 – Protects condominiums and covers personal property, liability and improvements to owner’s unit
HO-7 – HO-3 policy for mobile homes
HO-8 – HO-2 for older homes; only covers actual cash value
Do you still have more questions? Call us today and we can answer all your questions and give you a complimentary quote.
The SAIL Group
5301 E State St. #106