5 Questions To Ask Before Buying Home Insurance

Monday, September 14, 2015

In order to be a truly informed consumer, a prospective homeowner must ask a few questions before they purchase their home insurance policy. Speaking to experts about the type of coverage needed, the amount you are supposed to spend and other specific factors will help you to make the right decision. The following are five basic questions that should be asked prior to selecting a home insurance plan.

How Much Would It Cost To Rebuild?

A home insurance policy should provide total coverage in case your home is lost. Speaking to insurance company representatives will help you to gain knowledge of your neighborhood and the costs of the materials that you would need to rebuild your home. Policies should cover you in the instance of fire damage, hurricanes, hail, lightning strikes and all other natural disasters that are listed in your specific policy. Earthquake and flood insurance is usually sold separately.

What Is My Personal Property Worth?

Your appliances, your clothing, your furniture, all of these items should be covered by a home insurance policy. As long as the items are destroyed by a disaster that you are insured against, you are entitled to collect the full value of the items. In most instances, an insurer will suggest that you purchase a policy that covers up to 70 percent of the total value, although some may recommend a policy in the 50 percent range.

Do I Need Liability Coverage?

Liability coverage is crucial, as it protects families from lawsuits that are filed due to bodily damage and property damage caused by you or the family members who reside in your home. A liability policy covers any damages that are rewarded by the court, up to the limit of your policy and you are also covered anywhere in the world. The majority of insuring experts and representatives recommend the purchasing of a liability policy. Limits start in the $100,000 range, but in certain cases, a $300,000 policy is best.

Should I Buy The Earthquake/Flood Policy?

As mentioned before, earthquake and flood insurance is sold separately. As a result, very few people purchase either form of insurance. Depending on the region where you will be residing, you may need flood and earthquake insurance or you may be able to survive just fine without it. Speak to an insurance agent in your area, so that you accurately gauge your risk level.

Am I Eligible For Discounts?

Dead bolt locks, smoke detectors and burglar alarms will all net some form of discount. Retirees who are at least 55 years old often qualify for a 10 percent discount, as well. Modernization of your electrical systems and plumbing also lead to insurance companies offering a break in pricing. 

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