Homeowners Insurance Tips for the First-Time Home Buyer

first time home buyerYou have found the right house, negotiated the best price, and are on track to finalize the purchase and move into your first home. Finally, you are on the road to the American dream and financial independence. The purchase of your first home will likely be one of the most important investments you make in your life. Before choosing what color to paint the bedroom, how to arrange the furniture, or where to plant the rose bushes, one of the most important decisions you must make is choosing the right homeowners insurance coverage to protect your investment. Below is a breakdown of the significant factors you must consider when making this important decision.

What Types of Homeowners Policies are Available?

• Broad coverage for your home and personal property – this type of policy includes a list of losses that are covered by the policy. It covers the most common types of losses but it does not cover everything.

• Broad coverage for your personal property and all-risk coverage for your home – while your personal property is only covered for the most common types of losses, this type of policy includes comprehensive coverage for your home.

• All-risk coverage for your home and personal property – all-risk coverage for both your personal property and your home.

How Much Coverage Do You Need?

There are two ways an insurance provider can value your home: actual cash value and replacement cost. Insuring your home for the actual cash value may be the less expensive route, but doing so only insures your investment up to the current market value of your home. On the other hand, insuring your home for its replacement cost covers your investment for the full amount that it would cost to completely rebuild your home in the event of a total loss.

Your independent insurance agent will help determine the value of your new home based on factors such as: the date it was built, its size, its type of construction, and any other special factors unique to your purchase.

What is Covered by Homeowners Insurance?

• Your home
• Your garage and any other building on your property – attached or not
• Your personal property, including: appliances, electronics, clothing, outdoor equipment, tools, etc. Most policies provide limited coverage for these possessions when they are not on your property.
• Injuries to people on your property.
• Your liability if you or a member of your family accidentally injure someone or destroy their property.
• Emergency living costs. In the event that an insured loss causes you to move out of your home while it is rebuilt or repaired, you are covered for the resulting temporary increase in your monthly expenses.

Additional important questions such as: “How much liability protection do I need “What is the right deductible for me?” and “How do deductibles apply?” will be answered during the initial consultation between you and your independent insurance agent. Your agent will help guide you through the process of securing insurance for your first home, helping you better understand your options and choose the right coverage at the best possible rate.

At Knapton, Reade & Woods, the protection of your home is our priority. To get a free homeowners insurance quote, please call us today at 800-779-4084, or click here to submit our online quote request form. For additional insurance information and useful safety resources, please read our blog, or visit us on Facebook, Twitter, LinkedIn and Google+.