Home Insurance

Home insurance basics that could save your thousands

As much as a home is important for everyone’s life, so is home insurance that helps protect thta home against accidents, damages, and natural clamities.

Though home insurance is one of the basic things that has to be taken care of soon after a home is purchased, inadequante information about policies forces thousands of consumers to find out at a later stage that the policy they have purchased for their home ins’t adequate thereby leading to grievances.

We understand that searching for the right home insurance policy might not be one of the most exciting of things in a home purchase process, but it’s certainly not one you want to rush. Do so and it’s highly likely you’ll end up with a policy which doesn’t match your requirements.

Make sure you chose a policy that gives all the protection you need. Futher make sure that you check the pay out And record of the home insurance company you select. Do this by speaking to friends who’ve made claims on home insurance policies, and looking at online rating sites such as reviews.com. If you’re in the market these are 15 questions to ask before buying your first home.

Think of your insurance agent as your new best friend. Almost. He or she—not your workmate, neighbor or Uncle Frank—should be the first to know if you fence your backyard, turn your basement into a game den, or transform your spare room into an office. Insurance companies can use seemingly insignificant reasons to refuse to pay out, so make sure you notify your insurer of any big projects, and always request—and keep—your insurer’s acknowledgment letter.

Read the small print of home insurance contracts is a vital aspect. Neglecting to do so could be the costliest mistake you’ll ever make. If you purchase a policy that doesn’t cover you for specific types of disaster, most companies will still allow you to make amendments. But discover you’re not covered after a flood/landslide/fire/alien attack, and there’s nothing you can do.

It’s risky to assume that home insurance is something you’ll never need. When searching for the right policy, try to image the various scenarios you could potentially encounter and make sure you’re covered for the worst possible one. It might mean spending slightly more on the initial cost, but experiencing a flood, fire, or burglary and finding out you’re not covered will cost you much more.

So you know what amount you purchased your home for, and you know how much your neighbor’s house went for (or at least what they told you it went for). But hundreds of factors can affect the value of a property, ranging from the distance to the nearest house to the layout of the bathroom. Always take the time to correctly and thoroughly evaluate the cost of your home.

Many homeowners don’t realize that the average policy doesn’t cover the most common types of disaster. Homeowners often assume that typical policies—often called “all-risk insurance”—cover all sources of loss. Typical homeowners’ insurance policies don’t cover floods, earthquakes, wildfires, mudslides, sewer backups, and other risks, and they may have special deductibles or other limitations on causes of loss.

Think again if you’re assuming that the flood which wrecks your dishwasher will result in a juicy check that covers what you paid for it ten years ago. Be realistic—take a look at websites like Craigslist and look at how much second-hand dishwashers are going for. If you’re lucky, your insurance provider might payout for a similar amount.

You might well have paid $200,000 for your apartment in 2000, but your home will almost certainly be worth more now, and it’s all too easy to underestimate the increase in value. Consumers can buy endorsements such as ‘inflation guard’ that ensure there is full coverage of at least 80 percent.

Chris Davies

Chris Davies is the editor at Insurance Day. Chris was highly active in the insurance industry soon after he graduated from college. After over 10 years of experience in the industry, Chris decided to spread his know how and knowledge about the industry by taking up journalism and landed the job of editor at Insurance Day.

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