Walking through the door of your first home is an exciting milestone. However, the steps it takes to get there can be exhausting, from all the inspections, negotiations, and financial paperwork. But before you get excited and get the keys to your new abode, it is essential you consider your homeowners insurance needs. As a first-time home buyer, here is what you need to know about home insurance in Vancouver, WA and how you can safely secure the right policy.
Homeowners Insurance for First-Time Home Buyers
- Research before you buy
If you are purchasing your home through a mortgage, your lender will most likely require you to take out a homeowners insurance policy in order to protect their investment. While you know you need coverage, it’s worth understanding what home insurance covers and what it can do for you if the worst should happen.
It’s important to understand the basics of home insurance so you can purchase a policy that meets your needs. A standard policy provides coverage to protect you from the expense of a dwelling, personal property, or liability loss. Your insurance will also cover other structures on your property, such as a fence or detached garage. If your home becomes uninhabitable, the loss of use coverage will cover additional costs to maintain your normal standard of living, including hotel room bills, food, and additional transportation.
- Know the difference between replacement cost and market value
Your insurance will traditionally be based on the replacement cost of your home. Replacement cost is the total cost to rebuild your home with similar types of materials. You should ensure that this amount is enough to cover a total loss. A market value policy, also known as actual cost value, only covers up to the current cash value of your home. Keep in mind that the cost of clearing debris and rebuilding your home will most likely be greater than its cash value, so a market value policy will only cover a portion of these expenses.
- Understand coverage gaps
While your home insurance works hard to protect your home and property, every policy will have its limitations. It’s important to fill in coverage gaps that can affect your unique needs. For example, flood, earthquake, and sewer back-up damages are not typically covered in a standard home policy. If your home is vulnerable to these issues, then you should secure additional coverage.
- Bundle up
Often, insurance companies will offer you a discount on premiums if you take one more than one insurance policy with them. To help you save money without sacrificing coverage, consider bundling your home insurance, auto insurance, and life insurance with a single insurer.
- Keep it up to date
Once you move it, it’s easy to forget about home insurance. However, it’s essential to review your policies every year and keep it up to date. If you’ve made an addition to your home, bought or sold any high-value items, or improved home security, let your insurer know so that the policy can reflect the changes.
These are just a few tips for first-time homebuyers on how to secure reliable homeowners insurance. Once you have a policy in place, be sure to review it regularly and stay in contact with your insurance agent. A little preparation now can go a long way in protecting your pocket and property.
At Action Insurance Group, we can help you find and secure affordable insurance for all your needs. Serving Vancouver, WA and the neighboring areas, contact us today to get started.
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