Buying a Home? 4 Things to Understand about Home Insurance Coverage

If you are buying a home, as part of the agreement with your mortgage lender, you will be required to carry home insurance. Home insurance can provide you with a wide range of protections that you can access if you understand how your policy works.

#1: The Home Itself Is Protected

First, with homeowner's insurance, the home itself is protected. If the home is damaged under a covered peril, then you will get help fixing up that damage. You will have a deductible you will have to pay whenever you file a claim, so you may need to consider that when filling a claim. 

Some incidents are not covered with a typical home insurance policy. It is important to remember that both floods and earthquakes require their own insurance policies.

#2: Other Structures Are Also Protected 

Second, your home insurance protects more than just your home. It protects other structures on the property as well. So, if you have a detached garage, storage shed, or even a fence, then you should know each structure is covered. The coverage limit for other structures is usually only a small percentage of your dwelling coverage, although you can also buy more protection as needed. Be sure to figure out if you have enough coverage or if you need more.

#3: Personal Property Is Protected

Third, your home insurance policy also protects your personal property. The things in your home are protected with your insurance policy. That means all of your clothing, electronics, and furniture are covered. You will want to do a home inventory, figure out the value of your items, and make sure that you have enough coverage. You can always increase the coverage limit.

#4: Loss of Use 

Fourth, if you cannot live in your home due to a covered event, your insurance company will make sure that you have money for living expenses. Once again, the loss of use amount is usually connected to a percentage of your dwelling coverage limit, so be sure that your dwelling coverage is large enough to provide you with adequate loss of use coverage.

If you have more questions about how your home insurance policy works, you will want to work with your home insurance provider to get your questions answered. They will be able to let you know more about the intricate details of how your policy works. To learn more, call your agent today.