All lenders as part of a mortgage require a borrower carry an insurance policy that includes damage from fire, smoke, vandalism and theft. Many homeowners will upgrade their basic coverage to include personal liability and protection from additional hazards depending upon the risk factors and location.
Typically the hazard portion of a Home Insurance Policy usually protects furnishing and personal items as well as a detached structure or pool.You pay additional fees to cover the loss of expensive jewelry or computers or artwork, etc.
Tips:
- It is a good idea to include personal liability coverage. It is not required by lenders but it protects you from lawsuits over injuries and medical bills.
- Purchase a Homeowner's Policy with a high deductible and only filing claims for large damages.
- Keep an inventory of personal items.
- Get all valuables like artwork, jewelery, etc appraised and keep their pictures in a safe location.
- Shop around and talk to several agents.
- The lowest quote may not be the best. Compare apple to apple, look at the reputation of the company and check the references. Ratings can be checked such as A.M. Best and Standard & Poors as well as Consumer Magazines.
- If you purchase Home and Auto Insurance together from the same company, you could receive a discount.
- Be aware that the total price you pay for your home is different than the cost to rebuild. Make sure your policy covers replacement costs.
- Check with your professional organizations for group discounts offered to select companies.
- Review your policy annually and make adjustments. Talk to your insurance agents for clarification.
- Depending upon the location you may be required to buy Flood Zone insurance. Your lender will make you to buy this insurance.
- Minor upgrades like security alarms, dead bolts, etc. can reduce your premium.
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