All of the parts of buying a house are so much fun! Installing your new patio bar light and sound system is going to take your birthday party next year to the next level. But then there are the parts that aren’t really considered fun, like getting homeowner’s insurance. Which, yeah, is not as exhilarating as imagining your mom’s face of shock when she sees the bush or roses you planted right outside your door. She was totally wrong and it’s not overkill to smell roses every morning. Anyway, no more plotting! Let’s pretend to be serious about this amazing home you just bought. Let’s turn our thinking cap to the coverages our insurance needs to have and the basic knowledge of coverage.
How much is my “dwelling coverage”? Also, what is a dwelling? Does it need coverage?
Dwelling coverage is the portion of your policy that covers rebuilding in case of damage or destruction of your property. You should get this coverage assessed by an expert. Ask your insurance company to send someone to your home to conduct a replacement evaluation. You can also get extended replacement cost coverage. That extended coverage could get you about 10-50% more than the standard dwelling coverage provided by your insurer.
Are all deductibles created equally?
We’re going to tell you that not all deductibles are the same, just like not all home perils and damages are created equally. In this case, you have to ask your insurance agent or representative about all of your deductibles and try to understand why certain damages are valued at certain amounts and others are not. This way you’ll better understand where you stand financially if lightning strikes and the kitchen is burned down, or if you flush and a pipe explodes. They’re not covered equally, but at least you’ll know what expense each represents for you.
So, that means everything that could happen to my house is covered under my homeowner’s policy, right?
Wrong! Well, basic homeowner’s insurance policies don’t cover flooding. That’s a big one if you live near water or the ocean. They also don’t come standard with water coverage, meaning that if a pipe starts to leak into the wall, that’s your responsibility. In both these cases, you could add these to your policy by adding flood insurance and water backup coverage. That way a bill to fix these items doesn’t back you up unsuspectingly.
This is a lot of information, is there a way for me to save on homeowner’s insurance?
You know what they say: “Where there’s a will, there’s a way.” You can absolutely find ways of saving on your homeowner’s insurance. This could mean bundling your home and auto insurance, as well as whatever other insurance policy you need. Doing this could save you 20% or more. Also, paying for small repairs instead of submitting claims to your insurance may help keep your premium down. Reach out to your insurance company to find out about more savings.