How To Shop For Home Insurance
- Posted on
December 14, 2015
Home insurance is critical for securing your financial well being. It can ensure that dramatic events or sudden losses don’t irreparably harm your finances or your quality of life. If you have a mortgage, your lender will require it, but if you own your home and even if you’re renting, you shouldn’t be insurance for your home and belongings.
Here are some important tips to help you through the process of picking the policy that’s right for you.
Before You Shop: Determine Your Needs
- Assess the value of your belongings, and keep records to this effect so they’re readily available if you need to make a claim. This should include photos of your belongings, too, especially the most valuable ones. Some companies prefer or require visual evidence of ownership of items you make claims for.
- Know your home. The age of the home, the age of its main appliances and systems, the building materials used, and other factors can affect your premium, so have this information ready before you start shopping.
- Get the history. If you’re moving into a preexisting home, ask for the claims history for the property. It can alert you to what have been issues in the past and help you better gauge the coverage you may need for the future.
When You’re Shopping: What To Compare
- Customer service ratings and reviews. Choose a company that other customers have been consistently happy with. You don’t want a policy that looks great only to discover that the insurance company makes claims an unnecessarily miserable experience. Make sure that if something does happen, you’ll be valued as a customer and taken care of accordingly.
- Replacement cost vs. actual value. There’s a big, big difference between covering the value of an item or home and covering the replacement cost. That’s true of your belongings and the home itself. If you have to rebuild your home, it will likely cost significantly more than what the home would have sold for. You don’t want to get stuck paying thousands beyond your insurance coverage.
- Important optional coverage. Check what kinds of weather and natural events are included in a policy and how much it costs to add optional coverage like flood and earthquake, which aren’t typically included in an insurance plan. Consider your area’s weather and climate to help you decide what additional coverage would be important to have. If you’re in a new area, do some research.
- Coverage for items not in your home. Some plans will cover your possessions even if they’re in your car, for example, so that if the car is stolen, or items are stolen from the car, you can still file a claim and get it approved. Others cover belongings while you’re traveling. Find out, too, if items you have in offsite storage are available for coverage.
- Coverage for especially valuable items. You may need to purchase separate insurance policies to cover individual high-priced items or collections, including jewelry and art. Don’t let your most valuable belongings go unprotected.