How To Buy Your First Home Insurance Policy
If you are buying your first house, you will also have to purchase your first home insurance policy. You will need your coverage before you can close on the house you want to buy, so you must contact a homeowner's insurance agent to start the plan. As you begin working on buying home insurance for the first time, you might want to follow these tips.
Contact Your Current Insurance Company
Before you start looking for a home insurance company, you might want to consider calling your current insurance agent. Do you have auto insurance right now? If so, your auto insurance agent might also sell home insurance. If you can buy your insurance products from the same company, you might qualify for a discount. You can ask your current agent for a quote for coverage, but you can also contact other companies for quotes if you would like to compare the rates from several agencies.
Know What a Basic Policy Covers
When you discuss your needs with a home insurance agent, it is important to understand what a basic policy covers. Most policies protect your home and personal property from specific perils, including wind, hail, and fire. They might not cover damages from other perils, though, and this is important to know. You might want to add extra coverage to have more protection if you suspect that you have risks for other types of damages.
Understand the Difference Between Actual Cost Value and Replacement Cost
You may also want to talk to the agent about the valuation method they use for calculating losses. Most insurance companies use the replacement cost method or the actual cost value (ACV) method. You might be able to choose. Your policy will cost less if it offers the ACV method, but you will have more coverage with the replacement cost method.
Discuss Riders With Your Agent
The other thing to understand is that you can add riders to your plan to cover things in your home that your policy does not cover in full. Agents call these riders, and you might need one or many. You can talk to your agent about the things you own to determine if you need any riders with the home insurance policy you purchase.
After following these tips, you should find a policy that suits your needs. If you have questions about home insurance or would like a quote, contact an agent of your choice.