When it comes to buying home insurance, there are several facts that you want to examine and consider before you shop. Knowing what they are will help you pick out the best policy for your needs. Since home insurance isn’t one size fits all, this is extremely important. You want to get coverage that will help you when you need it most, and the following facts will ensure you do.
Fact One – Not All Companies Have the Same Coverage
Insurance coverage can vary wildly from company to company. The same goes for coverage tiers, what they do and don’t cover, and riders. For example, one company may offer coverage tiers that include flood insurance. However, another company may not have flood insurance listed in any of their coverage tiers, and you have to purchase it by itself as a rider. This is why it’s so important to compare different companies when you’re buying home insurance for the first time or switching out your current policy. The goal is to get as much coverage as you can for the best premium.
Fact Two – Not Every Damage Type Has Coverage
A standard policy does offer you several protections. They include coverage for your personal belongings, the structure of your home, and liability. Policies will typically state if they cover something, but it usually has to be accidental and sudden. So, if you had a leaking faucet that caused water damage over several months, it typically wouldn’t have coverage. However, even if certain natural disasters are sudden, they usually don’t have coverage under the standard policy. This includes earthquakes and floods from groundwater. Windstorms usually have coverage. If you live in a high-risk area, you might have a separate deductible for damage caused by a natural disaster.
Fact Three – Performing Routine Maintenance to Your Home Matters
Any home insurance company you partner with wants to ensure that the home is in good shape to prevent deferred maintenance from making the house more susceptible to damage. If an insurer finds that damage comes from you neglecting routine maintenance, they can deny your claim. Make a point to have regular roof inspections, keep your trees trimmed, and watch for leaks. An unusual spike in your water bill can mean that you have a plumbing problem that requires your attention.
Fact Four – Certain Belongings May Not Have Full Coverage
It’s nice to know that your personal possessions have insurance against theft and disasters. However, this coverage usually comes with a cap or limit. Generally speaking, electronics, silverware, firearms, furs, watches, and jewelry may only have a $1,000 or $2,000 coverage cap. If $10,000 worth of jewelry gets stolen, you’ll fall very short. Make sure you pay close attention to your insurance limits on all of the possessions in your home. You could consider adding a rider to give yourself more coverage.
Fact Five – Credit Impacts Your Costs
Your credit history is all over your financial life. It will play a role in the interest rate you have for credit accounts, and it helps to dictate how much your insurance premium is. For example, if you have median or fair credit, you’ll pay more for your premium than someone who has excellent credit. If you have poor credit, you’ll pay even more. There are currently only a few states that don’t allow insurers from using your credit when they check your rates. If you don’t live in Massachusetts, Maryland, or California, you’ll want to get your credit score up as high as possible to avoid paying more for your premiums.
Fact Six – There are Claim Deadlines
Most of the time, one of the first things you’ll do after a problem with your home is file a claim. However, what happens if you forget? You have an unlimited amount of time to file, right? Unfortunately, the answer is no. A lot of home insurance companies have claim deadlines you have to file by, and it could be as short as two weeks. If you don’t file by the deadline, the insurance company could reject your claim. If they do, you’ll have to pay for your repairs out of your own pocket. Depending on the scope of the damage, this could be extremely expensive.
Fact Seven – Some Dog Breeds Won’t Have Coverage
Although you love your dog, your home insurance company may not be as wild about them. Coverage usually includes liability for everyone in the house, including your pets. So, insurers are very particular about the breeds they’ll insure. More powerful, larger breeds may be on a blacklist for coverage that can require you to purchase a separate policy just for liability for them if you want coverage. A few popular breeds that typically get excluded from coverage include:
- Akita
- Chow Chow
- Doberman Pinscher
- German Shepherd
- Great Dane
- Mastiff
- Staffordshire Terrier or Pit Bull
- Siberian Husky
- Wolf Hybrids
Fact Eight – It’s Easy to Miss Discounts
Fair warning, your insurance company won’t tell you about all of the discounts you’re entitled to. Instead, it’s up to you to inform the company that you fit the criteria for specific discounts, so it’s very easy to miss them and pay more. When you add technology to your home that increases the safety levels or makes improvements, tell your insurer. This includes adding alarm systems, smoke detectors, upgraded doors, deadbolts, new roofing, or upgraded windows. Removing potential hazards from your property like a pool or trampoline can also entitle you to discounts.
