5 Home Insurance Mistakes To Watch Out For

Whether you’ve just begun searching for a new place or you’re waiting to close on your dream home, one important aspect of moving you can’t ignore is insuring your investment.

When shopping for your home insurance, make sure to look out for these costly mistakes.

1. Failing to shop around. Insurance providers differ in how they assess risk, which is the primary component in how they determine how much you pay for home coverage. This means your premiums with one company could be significantly higher than with another. So it is important to shop several providers to make sure you get quality coverage at a price that you’re comfortable with.

2. Choosing the wrong amount of coverage. Choosing incorrect coverage can come in more than one form: confusing the replacement cost of your home with its market value and under- or overestimating the amount of contents coverage you need. To make sure you get enough coverage, use a home insurance calculator or consult with your real estate agent.

3. Failing to update your policy. Over the course of a policy term, many things can change. No matter what changes occur, do yourself a favor by notifying your home insurance provider to ensure that you’re adequately protected. If you renovate your kitchen and add granite countertops or add more square footage to your home and fail to update your policy, you might not have enough dwelling coverage.

4. Failing to read the exclusions. Did you know that flood damage isn’t covered by your home insurance policy? Neither is damage from earthquakes. Every home insurance policy comes with exclusions, and it’s vital that you understand them.Go over your policy with a licensed agent thoroughly and be sure that you fully understand which perils are covered and which are not.

5. Setting the wrong deductible. The deductible is the amount you agree to pay toward a claim before your insurance takes over, and it often gets set either too low or too high. Your deductible can be manipulated to help save money on your premium. Speak with an expert to strike the right balance for your deductible amount.