What should you consider?
Your home is quite possibly your most prized possession. So, when you are deciding what type of insurance or how much insurance you need you need to think about your particular situation. You obviously want to make sure that the structure is covered but what about everything inside of it? Do you run a business out of the home? If so, is their equipment or inventory you need to make sure is covered? Are you a collector? Do you need to make sure your priceless memorabilia is insured? Maybe you have a lot of electronics in the home that should be covered. Whatever your personal situation is, you need to discuss this with your insurance agent to make sure, in the case of a total loss, you will have the coverage needed to replace everything you lose, not just the structure.
How does Condominium Insurance differ from Homeowners Insurance?
While a homeowners insurance policy covers the entire structure as well as your belongings, a condominium insurance policy only covers your unit and your belongings. It is important to get a copy of your condominium insurance policy when shopping for your personal insurance. Most condo associations cover the main common elements like roof, common areas, etc. However, some association policies also cover things like the walls and floors of your unit and even the original fixtures. So, it’s important to know what they cover, so you can make sure you cover everything else!
What does your typical insurance policy NOT cover?
This is a big one! Floods are not covered under a standard homeowners insurance policy. A separate Flood Insurance policy would be required to cover this type of an event.
How does your escrow account relate to your insurance?
Most mortgage companies require that you pay into an escrow account to cover your insurance and taxes. This is so they can guarantee these 2 things are getting paid for every year. You still get to pick your insurance policy and the company, but when the bill becomes due, the mortgage company takes the funds from your escrow account to pay it.
Are you covered if something is stolen from your home?
Your personal property is generally covered under your homeowner’s policy. Should something like a bike, lawnmower, tv, etc. get stolen you can make a claim on your insurance. This is why it is so important to have a proper inventory of your personal items. You also would need to consider your deductible when deciding if you want to make a claim.
Hopefully these “helpful pointers” will assist you the next time you are buying or renewing your homeowner’s insurance policy. Just make sure your policy is the right policy for you, not your neighbor!
Credit: Realtor.com