Buying a house is a monumental accomplishment and exciting time. But, the real treasure is making your house a home, where you feel safe and comfortable while creating meaningful memories.
Just as you protect what is most important to you, your home should also be a priority. Home insurance is not just a back-up, it is the first line of defense in feeling secure that your home is covered.
The Real Cost of Under Insuring Your Home
Did you know 2 out of 3 homes are underinsured? This could lead to significant financial loss that could be avoided by checking your home insurance coverage. On average, homes in the US are underinsured by 22%, while some can be underinsured by 60% or more.
There are many reasons behind this large home insurance gap: home-owners undervaluing their home, home-owners not believing there will be a need for the insurance, and other home-owners may be under the impression that house insurance comes with an expensive price tag.
First, let’s talk about the price-tag. Home insurance prices can fluctuate depending which coverage is chosen, filing excess of claims, and other factors. But, compared to the amount of cost protected, it is more beneficial to invest in the smaller cost of home insurance compared to the staggering financial strain an underinsured home can cause.
Creating a plan and asking the right questions can help prepare you for the financial cost while ensuring a safe home. But, what are the right questions to ask?
Top 5 Questions About Home Insurance Answered
Does my policy go up every time I file a claim?
It can depend on the types of claims and the amount of claims already filed. A single claim may not increase your premium right away, but filing multiple in a short amount of time can lead to higher priced policy. Before filing a claim, always check the price amount. If it’s less than your deductible it may be better to pay out of pocket instead of filing a claim.
Do I really have to make an inventory of all my possessions?
Yes. In the long run you will thank yourself for enduring a tedious task when your items are protected. Preparing a list of your possessions prior to filing your claim will lead to a maximized reimbursement because you know exactly what is being reimbursed and have proof of it.
When was the last time I checked my home-owners policy?
If you’re already a home-owner, it might be time to check if your policy is fully protecting you. Checking your policy is worth visiting at least every two or three years to make inflation adjustments, remodeling and construction costs, and to be sure you’re home is 100% covered. By having 100% protection and a replacement/repair cost protection, your home value in case of loss increases to 25%.
Am I planning to remodel my home soon?
For home-owners, it’s important to be preemptive while remodeling. Remodeling can increase the value of the house, which if not measured, can lead to a gap in home insurance. This can be avoided by discussing the remodeling plans with your insurance agent, thus making sure your home and bank account remain covered in any event.
Is there any way to have a lower premium without lower coverage?
No matter how appealing an extremely low coverage bill may be, it would be a bad decision in the future. There are ways to keep your coverage low while your home stays fully protected. There are many options that you could qualify for to lower the cost of your premium while still receiving all the benefits of high coverage.
How to Learn More about Home Insurance
It is always better to be proactive when it comes to home insurance, this means making sure you have inventory of everything covered, learning what qualifications you meet for a lower premium, and making sure your insurance is covering the value of your home.
To learn more about home insurance and receive specialized coverage for all of your house insurance needs, please contact us. Alternatively, you can learn more about homeowners insurance here.