When buying a home, one word you will hear often is "insurance." As a homeowner you are concerned about protecting your house, your personal belongings and your personal liability. It is important that the coverage you choose provides the comprehensive protection that you need.
Homeowner's insurance protects you and your house against losses from fire, theft, liability, vandalism, water damage, wind damage, tornadoes and loss of use. Earthquake insurance is not included but can be purchased separately.
There are three types of homeowner's policies to choose from. A clear understanding of the coverage each type offers will help you select the right policy for your needs. Each type carries a deductible amount you select.
Some of these policies offer optional guaranteed replacement cost coverage on your home and its contents. Replacement cost coverage will pay to rebuild your home and replace its contents with no depreciation coming into play.
It is important to understand that the replacement value of your home is based on your insurance company's estimate of the cost to rebuild your home on your property. It is not based on the purchase or appraised value of the home. Most policies have a built-in annual increase of replacement cost coverage.
When purchasing homeowner's insurance, there are ways of lowering your premium. Most insurance companies offer discounts for whole-house alarm systems.
Another way of lowering your premium is to select as high a deductible as you can afford. Raising your deductible reduces your premium.
Insurance is the type of service you buy hoping that you will never have to use it. Discuss with your Insurance Agent your unique needs and concerns when you purchase the insurance and whenever your needs change. The right insurance can give you a sense of security in knowing that you are adequately protected.