Whether you are just starting your search for a new home, or you are about to close on the home of your dreams, you are going to want to protect your investment and to do so will need to purchase homeowners insurance.
Homeowners insurance can be a homeowner’s best friend. And just like any other type of insurance, homeowners insurance vary in cost and coverage. The policy cost may depend on the age of the home, location, deductible and the amount of coverage you would like.
To help you find the type of homeowners insurance that is the right fit for you, we have compiled a list of what you need to consider when selecting your insurance coverage.
1. Location, Location, Location
While you are looking for a home that is near top schools, great shopping and dining and easy access to the freeways, insurance companies are looking to see how close your home is to fire stations, the number of fire hydrants near your home and if you are in a fire or flood zone. While homes located near fire stations can cost you less in homeowners insurance, homeowners near a coastline may have to pay more due to the fact that they have a higher risk of placing claims after a bad storm.
2. Think Twice before Denying Flood Insurance
Many homeowners insurance policies will not cover flood damage if a home is near a known flood zone; they will ask you to pay for a separate policy that covers just flooding. The good news is, not only are their options from a number of insurance companies, but the federal government also has a National Flood Insurance Program.
What if you don’t live in a flood zone? Did you know that 90% of natural disasters involve flooding? Even in areas that were not designated as flood zones. If you don’t live in a flood zone you may be able to get a low premium for flood protection.
3. Same Goes for Earthquake Insurance
When we think of earthquakes, we think of California, however 39 other states have experienced earthquakes. Like flooding, earthquake policies need to be purchased in addition to your standard homeowners insurance. Depending on your homes location, age of the home and home type (single family or townhome/condo), earthquake insurance varies in cost and deductibles.
4. Pool Owners
If your new home comes with a pool or you are planning on having one built, you will need to increase your liability coverage. Liability coverage is part of the homeowners insurance which pays toward the court costs and other expenses that accrue in your home for another individual. So as you can image, having a pool can increase your chances for slips and falls, as well as more serious accidents like drowning.
5. Having a High Deductible Can Pay Off
Make sure you shop around to find the best homeowners insurance that fits your needs. You should compare rates, deductibles and coverage options for at least three companies to make sure you have the right coverage for your home. Take note, the average homeowner will only make a claim around every 10 years. So if you pick a policy with a higher deductible, you end up saving money every year you do not file a claim, and the rate tends to be lower for higher deductible policies.