When to Purchase Homeowner Insurance – and What to Buy

When Should You Purchase Homeowner Insurance?

If you’ve purchased a home you need insurance – it’s as simple as that. Homeowner insurance protects you not only from damage from fire or other disasters but in many other ways (more on that later). Every mortgage holder will require the homeowner to acquire sufficient insurance coverage to protect the lienholder’s financial liability. Statistically 1 in 15 homeowners experiences a claim each year. Insurance protects you, your family, and even your visitors or neighbors from financial liability caused by personal injury caused by you or a member of your family that occurs on your property.

Insurance companies are regulated by the states in which they operate. To determine what coverages are required for your particular residence you should start with a visit to your state’s department of insurance to be aware of minimum requirements or special conditions that apply to your area, such as a possible mandate to acquire flood insurance. Many state web sites also include information related to insurance companies that are licensed to issue policies in your state.

Shopping for homeowner insurance rate quotes online by zip code is a quick and easy way to get started. This method ensures that you are obtaining insurance rate quotes that apply to your specific area.

How Much Homeowners Insurance do you Need?

Homeowners insurance can do much more for you than simply protect the physical structure from financial loss. Many types of coverage are available depending on your specific needs:

Home business – if you operate a business out of your home chances are you have an investment in office equipment, specialized furniture, or other items of value. This may require an additional rider or endorsement to your standard homeowner policy to protect those assets.

Valuables – home content coverage may not always be adequate to recover the replacement cost of particular collectibles or other expensive items in your home. You will want to be certain to evaluate any special endorsements or separate policy needs to cover such valuables.

Jewelry – it’s not unusual for a homeowner’s policy to limit the amount of coverage for jewelry or similarly high-priced items. To be sure you can recover loss from theft or fire of such items you may require an additional endorsement for items with significant replacement cost.

Replacement cost vs. actual cash value – this is an important distinction in providing coverage for your home and its contents. Your home may appreciate in value during the time you live there. Some content may also either increase in value, or become more expensive to replace in the future. Replacement cost provides the peace of mind that you will recover the amount needed to replace the home or personal item, as opposed to recovering what you initially paid for it.

Getting the Best Value on Homeowners Insurance

Now that you know what you’re shopping for, you need to make sure you’re positioned for getting the most for your money. There are a few steps you can take to make sure you get all the discounts or reductions that are available to you:

• Smoke detectors and alarms – these can save lives and money on your coverage
• Fire extinguishers – another potentially life-saving item that can also provide lower rates
• Multiple Policies – as with other forms of insurance having multiple policies with the same provider can position you for extra cost savings
• Home security systems – these can provide peace of mind, enhanced security, and discounted insurance rates
• Deductibles – your deductible is the amount you will be paying out of your pocket for an individual claim. Generally, the higher the deductible the lower your premiums will be. A word of caution though – don’t select a deductible that’s so high you can’t afford the deductible if a claim becomes necessary. Saving a small amount on your premium could present a financial burden when you have a claim against the policy.

Be sure to note any references to “exclusions” in your coverage. These indicate items or conditions which may impact what is covered and under what situations the exclusions are applicable.

Evaluating Your Homeowners Insurance Provider

An efficient way to obtain homeowners insurance rates is on internet sites shopping by zip code. This enables you to select the best options that multiple companies may have to offer in the way of coverage and discounts in your specific neighborhood.

Once you’ve obtained two or three rate quotes for your zip code the next step is to compare the potential candidates themselves. The National Association of Insurance Commissioners web site can provide some guidance on companies’ ratings and other information for consumers. You may also want to contact the Better Business Bureau in your area for any complaints logged by policy holders. Another good point of reference is the A.M Best site that can provide you with insight to your selected insurance provider.

Cautions When Comparing Homeowners Insurance Rate Quotes

Insurance can sometimes be viewed as a product where “you get what you pay for”. Don’t rely solely on price in making your decision on a provider. There are other factors that come into play:

Service – checking with consumer-related web sites and your state insurance department can be time well spent. No company is perfect but a consistent record of complaints raises a red flag immediately. Look for a company with a positive track record of responsive service and quick settlement.

Company stability – verify the potential provider’s length of time in business. Financial stability is important when you depend on the company to restore normalcy to your life through prompt processing of your claims.

Consumer feedback – social media sites and such publications as Consumer Reports can provide valuable insight into the level of satisfaction you may expect from the provider you’re considering.

For a quick and easy method of obtaining homeowner insurance rate quotes by zip code visit the InsuranceQuoteDepot.com site. You will find an efficient way to obtain coverage tailored to your personal needs from the convenience of your office, home, or mobile device.