Getting home insurance is a very necessary, but very boring part of owning a home. It’s so boring that sometimes, actually a lot of times, people make mistakes. We see it all the time and it breaks our heart. When you set out to buy home insurance save yourself some time and money and don’t do this:
Pick Actual Value Instead of Replacement Value
When you make a claim for a lost, stolen, or damaged item your insurer will cut you a check to buy a new one. The amount of the check will depend on if your policy has actual value or replacement value. If you have actual value, the check will be written for how much the item is actually worth, ie how much could you realistically sell if for. So if the item is old or dated, the amount of the check will be very low. However, if you have replacement value the check will cover the cost to buy a new item to replace the old one.
Focus on Price Too Much
Obviously you want to be able to afford your monthly premiums, but there’s no point in paying for a policy every month that won’t cover you when you need it. Price shouldn’t be the only factor your look at. Make sure you compare coverage as well as price.
Forget About Exclusions
There are many policies out there that will cover you for any and every possible claim. Policies will have exclusions, which list damages and incidents your home isn’t covered for. Make sure you know and understand these exclusions, so you don’t get an unpleasant surprise when it’s time to make a claim.
If you have a mortgage, the mortgage company will require you to have home insurance. However, they only require you to have enough insurance to cover the amount you owe to them. For example, if you have a $250,000 house, but only owe $75,000, the mortgage will only require you to have a $75,000 policy. Sure you’ll save on your monthly premium, but if your house gets leveled in a tornado the insurance check will only cover your bank note and you’ll be the proud owner of a pile of bricks.
Like we said before, getting home insurance isn’t fun, we get it. But this shouldn’t stop you from shopping around and getting multiple quotes. It’s a hassle to check with all the insurers to find the best policy for you, but will save you money. One fast and easy way to do your home insurance shopping is to use All American Insurance. When you go with us, we check with 30 different insurers to find your policy. All we need is a few bits of your information, and we’ll do all the shopping for you.