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Knowledge is your best friend and we feel that the following is very important when shopping for a home in addition to insuring it. Shopping for your dream house? It’s important to keep insurance in mind throughout the home buying process. Most lenders won’t provide a mortgage without insurance coverage. Your insurance company or agent, together with your realtor, can help you get what you want – a good home that is properly protected.
EVEN BEFORE YOU START LOOKING FOR A HOME Put yourself in the best possible position to be able to afford a home, receive the lowest possible mortgage rate and get insurance for your new house. This takes advance preparation on your part. Check your credit rating Good credit helps you in many ways, including getting a mortgage at a good rate. Depending on the state and the insurer, it may also help you save money on your homeowners insurance. Get a copy of one or all of your credit reports. Make sure they are accurate and report any mistakes immediately. The credit report helps you see how your credit standing compares to others. If your credit is not as good as it should be, begin to improve it immediately. Check your home insurance claims-filing history A good claims record can also be important if you are selling the home you are currently living in. However, a past claim does not have to be a problem; the resulting repairs or improvements, if done properly, can make a property more attractive to buyers and insurers.
Renters insurance If you are currently renting, it’s important to have insurance for your personal property. Your landlord’s coverage will not cover the things you own. If you haven’t owned a home before, it might be helpful to have a history of insurance when you go to buy your first home. HOUSE HUNTING As you look at homes, remember that characteristics of the house (where it is, how it's constructed and the kind of shape it’s in) can send your insurance rates up or down. Construction of the house If you are buying in a seismically active region, look for newer homes built to current codes or older homes that have been bolted to their foundations. They are better able to withstand earthquakes. Age of the house Older homes sometimes have features such as plaster walls, ceiling molding and wooden floors that could be costly to replace. Such special features may raise the cost of insurance. Also, an older home that has been updated to comply with current building codes is typically less expensive to insure than an older home that is not up-to-date.
Condition of roof and home If you are considering a "fixer upper," you may pay more for insurance until clear improvements are made. In particular, check out the condition of the roof. A new roof in good repair will be attractive to insurers and will save you money as well as aggravation. Plumbing, heating and electrical systems These systems can wear out, become unsafe with age or become dated as safer technologies are introduced. Recent upgrades make your home safer and less likely to suffer fire or water damage. Safety devices Homes equipped with smoke, fire and burglar alarm systems that alert an outside service may get sizeable discounts. Strong doors dead bolt locks and window locks may also reduce insurance costs. Pool, wood burning stove, etc. You will need higher property and liability coverage if you are buying a home with features such as a pool or a wood burning stove. In the case of a pool, consider getting additional coverage, such as an umbrella or excess liability policy. Quality and proximity of the fire department Homes near a fire station, those with a hydrant close by and those located in communities with a professional rather than volunteer fire department will cost less to insure. Location, location, location You also need to think about the threat of floods or earthquakes. You will need separate insurance for these risks and it can be costly. Also, around the country, there are high-risk areas vulnerable to hurricanes, brush fires or crime that might not qualify for private insurance. To make insurance available, there are state-sponsored Fair Access to Insurance Requirement (FAIR) Plans. FAIR Plans, however, can be expensive and provide less coverage. Get the house inspected A thorough inspection of the home is very important. The inspector should check the general condition of the home; show you where potential problems might develop; double-check that past problems have been repaired; and suggest upgrades or replacements that may be needed. If a house has been well maintained, you should have no trouble getting insurance. However, if the inspector raises questions, your insurance company will as well. In particular, have the inspector check for water damage, termites and other types of infestation. Special attention should be paid to the electrical system, septic tank and water heater. Find out if there is an underground oil storage tank, as many insurers will not provide policies for homes that have one.
Contact your insurance professional Evans-Moore Insurance Don’t wait until the last minute to think about insurance. Ask your current insurance professional if the house will qualify for insurance and get an estimate of the premium. The sooner you act, the smoother the process will be. If you do not have an insurance agent or company representative, get recommendations from family, friends or co-workers. Select someone you know and trust, as he or she will be an advisor for many years. PURCHASING THE HOUSE AND INSURANCE Congratulations, you are set to purchase your new home. Now you want to be sure you are getting the right insurance coverage at the lowest possible price. Take the highest deductible you can afford The higher the deductible, the lower the premium. Since most people only file a claim every eight to ten years, you will save money over time and preserve your insurance for when it’s really needed.
Ask about available discounts for: Multipolicy (home, car or other policies with the same company) Smoke detectors Fire extinguishers Sprinkler systems Burglar and fire alarms that alert an outside service Deadbolt locks and fire-safe window grates 55 years old and retired Long-time policyholder Upgrades to plumbing, heating and electrical systems Earthquake retrofitting to make the home safer Wind-resistant shutters
Get enough insurance to: Completely rebuild the house in the event it is destroyed by fire or other insured disaster. Replace everything in the house. Protect your liability in case someone is injured on your property and sues you.
Ask about additional coverage such as: Replacement cost for possessions Extended or guaranteed replacement cost for the structure Building code upgrades Sewer and drain back-ups Inflation-guard Umbrella coverage for a pool or other high-risk items Special riders for jewelry, collectibles and expensive items
Flood, earthquake and windstorm risk Damage caused by flooding and earthquakes is not covered by standard homeowner’s insurance policies. Instead, homeowners will need to pay an additional premium for coverage that is provided through the government’s National Flood Insurance Program (NFIP). To get flood insurance, your community must participate in the NFIP program. Policies for coastal properties will have a sizeable windstorm deductible, which means the homeowner may be responsible for thousands of dollars of damage before insurance kicks in. It pays to know what is in your policy. Earthquake insurance is offered by private insurance companies.
AFTER YOU PURCHASE YOUR NEW HOME Properly maintain the house Maintain your home as you would your car. Every year, there are important things you should do to reduce the chance that you will experience water damage, fire or other insured loss. Insurance does not pay for routine maintenance or damage resulting from neglect. The cost for proper care should be calculated into your overall budget. It’s your responsibility to be the "risk manager" for your home. If you do your part to reduce insurance losses, not only will your home be safer; it will also save you money on your insurance bill.
Keep insurance up-to-date Let your insurer know about alterations, additions and improvements to your home. Major purchases and lifestyle changes such as a marriage or divorce should trigger a call to your insurance professional. This way, you can maximize your insurance dollars by not being either under- or over-insured. e-mail questions to:
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