Home Buying Tip #10: Insights To Selecting Homeowner's Insurance!

Real Estate Agent with Comey & Shepherd Realtors

The other day I asked one of my Preferred Service Team Professionals, Karen Bastian of American Family Insurance, the following question: "What are some things a buyer needs to know about making a decision on which homeowner's insurance policy to purchase for their new home?" Here's what Karen said:

"There are several things to consider when purchasing a homeowner's insurance policy.

First we'll look at the dwelling coverage, which is insuring the structure itself and anything permanently attached to the structure (such as kitchen cabinets). It's very important to make sure the policy is covering your house for replacement cost. There's software we go through to determine how much it would cost to rebuild your house if you had a total loss. You want to make sure they'll be able to rebuild your house just as it is. This is also why it's important to review your policy every year or two with your agent so you can continue to monitor the policy and it's coverages to make sure you're never underinsured.

Replacement cost is also an important factor when it comes to your contents. The contents are everything you own in the house that isn't attached: your furniture, clothing, electronics, dishes etc. In the event of a loss, when you have replacement cost, depreciation is not factored in. For example, if lightning strikes your TV, you would just go buy a similar new TV. We also strongly recommend that you take an inventory of your contents. If you were to have a major loss, there's no way you'd remember everything you need to replace. You can make a written list, take pictures or a video. It just needs to be enough to jog your memory. Keep the list or pictures off premises with a family member or a safe deposit box. It wouldn't do you any good if the list burned up in the same fire that destroyed your contents.

Another coverage that's part of your policy is called "loss of use". This means that if your home is uninhabitable due to a covered peril, your additional living expenses would be covered. The important thing here is to make sure the policy gives you a 12 month time limit to repair or rebuild without a dollar limit. Some companies impose a dollar limit but there are times when it takes awhile to rebuild so you could potentially run out of coverage.

Many people don't realize that their homeowners policy also includes liability coverage. This certainly covers any guests who may be injured on your property but it also covers you and your family wherever you are. For example, if you're on the other side of town at your child's ball game and they injure someone during the game, the liability part of your policy will provide coverage.

These are just a few of the basic things you need to know when purchasing a homeowner's insurance policy. Please feel free to contact me with any questions you may have."

Karen Bastian Agency, LLC American Family Insurance
3476 Irwin Simpson Rd, Ste 112
Mason, OH 45040
(513) 459-3063

Posted by

Dan Weis
Real Estate Consultant since 1985
Comey & Shepherd Realtors

Cell/Text: 513.615.1890

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