Your home will be one of the biggest investments of your entire life. For many people, it represents several years’ worth of income in value. You’ll want to do whatever you can to protect its value including securing homeowners insurance. Here’s what you should know about this type of insurance.
Why do you need homeowners insurance?
The bottom line is that you need homeowners insurance to protect your investment and your financial well-being. Just like any other kind of insurance you carry, policies are designed to make you as close to the hole as possible should some unfortunate circumstance occur. And if you financed your home through a traditional lender, you’ll be required to keep a policy in good standing for as long as you’re paying your mortgage.
What does homeowners insurance replace?
Your homeowner’s insurance policy will come with a declaration page, and benefits catalog, that will outline what the policy does and doesn’t cover. Typical policies cover damages to your home caused by weather events like hail and wind, and by fire. It will cover the structure, your personal property inside, and it will also provide liability protection for anyone that might get hurt on your property. Not all acts of God are covered by insurance though, and you’ll need to explore supplemental policies for earthquakes and floods.
Finding homeowners insurance
If you’re looking for homeowners insurance and don’t even know where to start, one place might be with the carrier of your car insurance. Many insurance companies these days offer a large portfolio of products. It might be worth a call to your agent to find out if homeowners are one of them. If it isn’t, they can probably point you in the right direction for another provider.
Understanding your policy documents
As mentioned above, when you get a new homeowners policy, the insurance company will likely send you a thick envelope of papers related to the coverage. Among those, you’ll find a declaration page that spells out the coverage limitations of your policy, a coverage page, billing information, and likely information on how to submit claims. You should keep these documents stored away in a safe, protected place in the event you might need to refer to them in the future.
