Don't let your clients buy a Home Owners Policy just to get through closing.

Services for Real Estate Pros with Sprague & Killeen, Inc

Insurance Basics for Home Owners

Part of what our clients need to think about (with all the other items to get ready for closing) is the need for the right Home Owners Policy.

The homeowner insurance policy covers more than just the structure of the home. It should also cover their belongings inside the home and provide liability insurance to protect against injury claims (i.e. slip and fall on the front steps).

The Structure

The homeowner policy should protect the home's structure (and any other structures on the property). The policy should cover anything that causes damage or loss to the home. Having said that, all policies are not created equal and most policies have exclusions for certain causes of damage. Depending on the perils in the area, endorsements can be purchased to "buy back" coverage. Always keep in mind that insurance is based on REPLACEMENT COST (what it will cost to replace the home) and not the amount of the mortgage!

Personal Property

Personal property should also be covered. The coverage on the homeowner's property typically is not the same coverage that is on the home. Yes it is the same policy, but the perils coverage against are not the same. Again, all policies are not created equal and enhanced coverage options are available. Also remember your client's belongings do and will be traveling.

One of the first things I can recommend to a new homeowner is doing of an inventory via video tape or use a home inventory check list. Any video documentation or check list should be kept off premises or in a fire safe lock box. An inventory will also help determine the real needs for insurance coverage. Some items may need special coverage like jewelry, fine arts, collectables etc.


As part of basic homeowner insurance, your client will receive liability coverage. Again, this provides protection if a 3rd party is hurt on the property regardless of cause. The standard limit of insurance that comes with a policy is $100,000. Not my recommended limit. You will be surprised to see how inexpensive it is to raise this coverage from $100k to $500k or even purchase a personal umbrella policy (excess liability typically starting at $1,000,000 in coverage).

For more info, feel free to contact me.

Please let me know how I can help you help your clients.

Comments (7)

Maureen Maureen
Orangeburg, NY

Christopher - thanks for the informative post and welcome to the I love NY group!

Jan 03, 2007 11:21 PM
Christopher Clark
Sprague & Killeen, Inc - Ellenville, NY
Thanks Maureen. I look forward to contributing and getting to know all of you
Jan 04, 2007 02:53 AM
Skip Weisman
Weisman Success Resources, Inc. - Poughkeepsie, NY


Welcome to AR, glad to have you sign up and getting started on the blogging scene.

You have a tremendous opportunity to provide valuable insights to the members here
and I encourage you to connect as often as possible.

Keep up the good work and thanks for all your help and support with my business
insurance needs and your staff is doing a wonderful job in helping me transition
into my new home, closing coming up the end of this month.

Jan 05, 2007 03:13 AM
John Klassen
M & T Bank - Kingston, NY

Great post! The time to find out what your policy covers is not when you are filing a claim. People who choose insurance, loan officers and real estate agents based on price and get shafted in the end.

Thanks for a great post.

Jan 07, 2007 09:31 AM
"Tommy" Decebal
HomeSpector Inc. 516-851-5833 - Farmingdale, NY
Adamescu Long Island NY MASTER Home Inspector
Adele Irving - Easton Area Homes
Prudential Patt, White Real Estate - Easton, PA
Thank you for the helpful information.  I hope you are having happy holidays!
Dec 25, 2007 10:12 PM
Jesse Turnquist, CMPS
Guardhill Financial Corp - Hudson, NY
Christopher--Thank you for your made me pull out my own policy to make sure I've got all the important things covered!
Dec 26, 2007 06:50 AM