How to Choose Home Insurance
No one likes to anticipate a loss, but being prepared with the right home insurance can make dealing with one much easier. Home insurance covers the house itself, plus all the things inside that make your house your home. Having adequate insurance means you won’t suffer a huge financial loss on top of the material loss.
Our homes represent much more than a place to live in between work and other activities. Home is where we take a break from the world, where we feel safe, and where we build family memories. Home insurance is a way to protect yourself against the loss of your most important asset.
How much does home insurance cost?
Home insurance rates can vary greatly from company to company. The cost of the policy also depends on the cost of your home (what you paid for it) and the value of the contents (all your belongings). The number of recent claims a company has had can affect rates as well (fewer claims = more money available for discounts).
The “dwelling” portion of the policy covers the house for the amount it would cost to replace it. This amount does not include the value of the land, and will likely be less than the total amount you paid for the house.
The “contents” portion of the policy covers the value of all your possessions. Here is a tip: If you have a lot of valuable items you would need to replace, take a video of the items and record any serial numbers, brand names, and when they were purchased so you have documented proof for a claim. (Be sure to store the video somewhere secure and accessible outside your home.)
Home Insurance Rider
Most home insurance policies will not cover the full value of expensive items, such as jewelry worth more than $1000, valuable artwork, or family heirlooms. For these, you will need to take out a home insurance rider at additional cost.
Loss and damage due to flooding is not covered by a standard home insurance policy, but is required as an addition to your policy in areas where floods are likely. Similarly in some places, you may be required to purchase insurance against wind, hail or other natural disasters.
How You Can Save on Home Insurance
Home insurance is required if you have a mortgage to protect the mortgage holders’ investment. Even if you own your home outright, however, having insurance is a wise purchase, because the cost of replacing a home and its contents is prohibitive for most people. There are, however, ways to save money.
• Bundling your home and auto insurance. Using the same company for both typically entitles you to a sizable discount.
• Shop around periodically. Even if you already have home insurance, rates fluctuate and vary from company to company.
• Use Compare Insurance Quotes to easily find the best rates.