If you own a home, you need homeowner’s insurance. Especially if that home is financed, where you are mandated by the agreement on your lending policy. But what type of coverage should you get and what should you do during the process of shopping for homeowner’s insurance?
Escrow Your Payments
No matter the policy you decide on, make sure you escrow your payments with your mortgage. This means that you are rolling them into your monthly mortgage payment so that it’s just one bill. It’s one less thing to have to think about. Usually the company that you choose will take care of contacting your bank to make arrangements. Typically, property taxes and homeowner’s insurance are escrowed into your mortgage payment.
Choose a Realistic Deductible
You want to make sure your deductible is realistic. If you have a $10,000 deductible, you may find yourself in a sticky situation should something happen to your home. But a $1,000 deductible could mean that you are paying too much for your monthly premium. Be sure that you compare your options here. Balance what you’d have to pay out if something were to occur with what you can afford to pay on any given month to find the happy medium.
Know Your Coverage Options
A very common mistake when shopping for homeowner’s insurance is to ignore the coverage limits. Many insurance companies now offer supplemental add-ons that give you added coverage. For instance, you may want to add extreme storm coverage so you never have to worry about your roof. Carefully explore all of your options in this arena. Usually these add-ons are economical and could be a life-saver should the unthinkable occur.
Get Multiple Quotes
Never just presume that one company is the best one to use. Instead, be diligent and take your time to research a few other companies. You may be surprised to find that you can get better coverage at a lower rate from a competitor. Along the way, also make sure you conduct ample research into the reputation of any company you are considering. Make certain you feel fully confident with placing your trust in them to protect your home. Do this and you can avoid being the main character in a potential horror story.