How to Insure Your New Home
Your new home is a very valuable asset. It is important to be sure that you have the proper insurance coverage for your home and the contents that are in your home. Not having proper insurance can be devastating in the event of an accident or catastrophe.
What Is Home Insurance?
If you have a mortgage on your home, it is most likely mandatory that you have the correct amount of home insurance. Home insurance offers many different levels of protection. The greatest assets to a home insurance policy include protection from damage and theft, to your home or your personal belongings, and legal protection from liability lawsuits.
Comprehensive Home Insurance
Comprehensive home insurance may also be known as “all risk home insurance.” It is known as an all risk home insurance policy because it offers you protection from all risks unless they are specifically excluded from your home insurance policy. This type of home insurance coverage will offer you protection on your building structure and contents–it will provide protection for all areas of your home. Some common exclusions to this type of insurance may be earthquake coverage, water damage coverage, or damage that is caused by rodents, mold, or neglect. You may be able to add these on to your comprehensive home policy as a rider if you feel you need this area of protection.
Standard Home Insurance
If you purchase a standard home insurance policy, your home may only be covered from loss by a list of named perils or designated risks. This will usually include damage that is caused by fire, wind, explosions, or vehicles. There will be no exclusion list with this policy. If it is not on the list of covered perils, it is not covered under your home insurance policy.
Broad Home Insurance
Broad home insurance policies offer a mix of comprehensive home insurance coverage and standard or named perils home insurance coverage. Under this type of policy the structure of your home will have comprehensive protection, while coverage for your contents may be more like the named perils of a standard home insurance policy.
Compare Insurance Companies and Policies
Before you commit to one insurance company, it is best to shop around and do a little research. All insurance companies and policies are different. It is important to call at least three different insurance companies, ask each company for a price quote and a sample policy. Read the whole sample policy, including any fine print. Compare the price of the different policies and the difference in coverage options. If you have any questions about the home insurance, ask them prior to purchasing the policy.
The Cost of Home Insurance
There are many different factors that are considered when it comes to the cost of home insurance. These factors can include the value of your home, the location of your home, and the amount of your deductible. The amount of your premium may be lower if you have installed certain security features. Many insurance companies will also offer a multi-policy discount if you carry your car, home, and life insurance policies with them.