Tips on Buying Homeowners Insurance
- The location of your home will greatly affect the amount of your coverage. Living in high-risk areas, such as close to major waterways or earthquake faults will increase your premium. Buying a home close to a fire hydrant or fire station may save you money. Before buying, be sure to check the Comprehensive Loss Underwriting Exchange (CLUE) report on the home. The report includes any previous claims made on the home and can give you an idea of any potential problems.
- Homeowner's insurance does not include protection against damage from floods or earthquakes. It may be smart to purchase separate insurance. Make sure to purchase enough insurance to replace your property and assets. Typically, your home is only insured for the purchase price and your assets insured for their current value. Purchasing a replacement policy allows you to be able to replace your home and assets even if they exceed the original value. If you have expensive jewelry, you may need to purchase additional insurance. Consider getting your jewels appraised. In addition, you will need to purchase personal liability coverage, which protects you in the event that someone is hurt in your home.
Adjust your homeowner's insurance if there are any changes, such as an addition of a security alarm or a new fire hydrant. Each year, compare your policy against other providers to ensure that you are getting the best deal. - The deductible is the amount that you must pay before your insurance company begins to pay. Typically, the deductible would be about $500. Consider increasing the deductible to $1,000 in order to save you money on your monthly premium. Keep in mind that doing so means that you will be liable for any small repairs that are less than that amount.
- You may be eligible for a discount for having certain safety features such as dead bolt locks, a security system, fire alarms, storm shutters and fire resistant roofing. A security system that is monitored may result in a 5 percent to 20 percent discount. In addition, seniors may be eligible for a 10 percent discount. Inquire if making certain updates would lower your premium, such as modernizing your heating and electrical systems or reinforcing your roof. In addition, it may be financially expedient to purchase your car, auto and home insurance from one provider.