As your biggest personal asset, you want to make sure that your home is protected properly in case of an emergency. While there are many ways to do so, the best one is to obtain home insurance.
In general, home insurance is a type of insurance that provides financial protection by covering the costs of repairing or replacing a home if anything goes sideways. Although it isn’t required by law, it can be of great help if unexpected costs arise in the event of an accident, theft, or vandalism, or if your property sustains damages caused by natural disasters.
Unfortunately, for many, shopping for home insurance can be a daunting task. To help you along, we decided to write the ultimate guide outlining the five most important things you should consider when purchasing home insurance.
Types of home insurance coverage
There are several types of home insurance coverage you can obtain, all of which differ in their levels of coverage against various risks and damages. The two most commonly purchased are dwelling coverage and personal liability coverage.
The first one covers for repair or replacement of the home and its contents caused by a natural disaster, theft, or vandalism, whereas the latter provides legal and financial protection if someone gets injured on your property.
However, insurance companies also offer additional coverage options to suit the different needs of homeowners. For example, if you live in a high-risk flood zone, you should consider purchasing home insurance that offers flood coverage.
Premium rates
When it comes to determining the price of home insurance, there are several factors that are taken into consideration. These include your property’s size, age, condition, location and environment, the value of the property and its contents, and discount eligibility.
Because prices of home insurance vary between companies and states, it is advised that you first compare quotes from multiple companies instead of settling on the first one you find.
A professional broker can help you with this. For example, if you live in Calgary, Canada, consult with your broker to help you shop around for the best Calgary home insurance rates in your area and purchase coverage that meets your needs and budget.
Discounts available
Because home insurance can be quite costly, you should talk to your insurance provider to see if they offer any discounts so you can lower your premium. Most companies offer:
- Bundling different insurance policies together;
- Having a security system;
- Raising your deductibles;
- Living in a low-crime rate area;
- Having a good credit score.
For example, bundling your homeowner’s insurance with your car insurance can certainly help you save some money on your premiums.
Claims process
Understanding how the claims process work is very important when purchasing home insurance. If your property gets damaged by a natural disaster of some kind or some contents of your home have been stolen, the last thing you need is to quarrel with your insurance company to get your damaged claim paid fairly and quickly.
So, make sure you ask your insurance provider about how they will pay out your claim. Before you sign your contract, you might also want to read online reviews and testimonials of previous customers to get insight into how the insurance company treated them and helped them with the claims process.
Policy’s fine print
Home insurance policies can be a bit complex so reading your policy’s fine print is very important. Doing so will help you understand what is covered by your policy as well as make you aware of all associated fees and charges that are included to cover exclusions and limitations.
If you need help with this, make sure you consult with your insurance broker to explain to you all the terms and conditions mentioned in the policy.
Also, it is advised that you check in with your insurer at least once a year to ensure your policy provides adequate coverage, especially if you engage in new home improvement projects which may increase the cost of your premium.
Final thoughts
Although there are many ways to protect your home, one of the best is to purchase home insurance. This way you will have financial and legal coverage in the event of an accident, natural disaster, theft, or vandalism.
In order to get the most out of your home insurance, be sure to refer to our post and read about the most important things you need to consider when obtaining your coverage.
