Choosing More Coverage

Posted on: 6 October 2020

Buying a house is an exciting event at any time, but buying your first house is extra special. For most people, owning a home is something that they have always dreamed of, so achieving that goal is something to be proud of. If you're a first-time homebuyer going through the process of buying a house, one of the things that you will need to do before your closing date is to buy a homeowner's insurance policy. Homeowners insurance will cover the cost of damage to your home, or pay to have it rebuilt if it is a total loss. Your belongings will also be covered by your homeowner's insurance. Use the following tips to help you purchase homeowners insurance when buying your first house:

Pay Attention to the Amount of Coverage You're Purchasing

If you have never bought a homeowner's insurance policy before, the process can be a little overwhelming. A common mistake that first time home buyers make is purchasing a policy based on the market value of their home, not the replacement cost. The market value of your home is most likely substantially more than the replacement value, so if you use that figure, you will be spending more money on your home insurance than you need to.

Consult an Expert

It is normal to be uncertain about what type of coverage you need when buying your first homeowner's insurance policy. If you want to ensure that you have the right level of protection while also avoiding buying a larger policy than you need, your best bet is to speak with an experienced insurance broker who specializes in homeowner's insurance. An insurance broker will be able to answer your questions and help you find a homeowner's insurance policy that best fits your needs.

Understand Your Policy

Before you purchase a homeowner's insurance policy, it is essential to have a complete understanding of its terms and what type of coverage is provided. You should seriously take the time to read through the policy line by line; if you are confused by any information, don't be afraid to ask for clarification. One thing that you need to know is if the policy has any exclusions. For example, many home insurance policies do not provide coverage for earthquake damage or flood damage due to severe weather. If the insurance policy that you're planning on buying has these types of exclusions and you're buying a home that is in an area at risk for earthquakes or severe weather, such as hurricanes, you will need to purchase supplemental insurance.