Purchasing your first home is an exciting experience. It is an opportunity to finally have some control over deciding between prioritizing that his and hers bathroom sink or choosing a home with a backyard big enough to host parties. Becoming a first-time homeowner can be viewed as a big step toward the path of becoming an adult. Often remiss from the conversation of choosing the home is the importance of having the right homeowners insurance. These are a few pertinent questions to understand that could help complement the right home with the right homeowners insurance.
Do I Need Homeowners Insurance?
Obtaining homeowners insurance is a choice. However, be prepared for your homeowners association (HOA) or bank loaners to require it. As of 2013, the Insurance Information Institute (I.I.I.) found from U.S. Census that 95% of homeowners had homeowners insurance. It is merely a matter of protecting your investment. The concept is very similar to renters insurance, if you had lived in a condo or an apartment prior to purchasing a home. Buying a home traditionally serves as one of the first major investments for individuals or couples; it is deserved of a thorough analysis when evaluating the best possible coverage.
What Does Homeowners Insurance Cover?
Homeowners insurance is a protection plan supporting your investment to purchase a home. It is intended to cover costs for property damage, the risk of potential liabilities, and the possibility of any legal claims made against you. There are 5 common areas of coverage within basic homeowners insurance:
- Dwelling – Covers the infrastructure of the property.
- Other Property – Covers anything detached from the infrastructure of the home.
- Personal Property Coverage – Personal possessions and anything owned within the home.
- Liability Coverage – From potential damage or injuries from visitors of the home.
- Additional Living Expenses (ALE) – In the event for possible displacement from your home, ALE may provide living expenses such as meals or hotel accommodations.
How Much Does Homeowners Insurance Cost?
Another way of asking this is identifying how much insurance coverage you will need. Rates vary based on a few common evaluations: the condition of the property, neighborhood of the property, state residence, and credit score. These costs reflect the potential risk involved with the home and owners of the property. If you are proactive, minor observations could have a major impact on lowering your homeowner insurance rates.
How to Save Money on Homeowners Insurance?
Keep in mind these rates aren’t static. There are ways over time to make your homeowners insurance more cost-effective during the lifespan of a home. If you can reduce the inherent risk of being a homeowner, then you can reduce the cost of coverage to protect it. An example of this would be installations of home security systems leading to lower insurance premiums. Although it may not happen overnight, alterations or improvements to the home over time can save you money in the long run.
One of the most common ways to save money on homeowners insurance is by bundling other packages (i.e., auto) with the same insurance provider. At the TJ Woods Insurance Agency, we can help accommodate you in any stage of your life. Follow-up that excitement of being a new homeowner with having the best way to protect it. If you have any questions or are looking for more information on how to find the best rates for you, contact us today to find out how we can help.
