The Ins and Outs of Buying Your First Home Insurance Policy
How much would you say you know about home insurance? A lot? A little? Whichever camp you happen to fall in, if you're shopping for home insurance for your first house you better catch up quick! There's a lot that goes into making sure you get the best deal possible on your insurance coverage, and at a time when hundreds of homeowners are paying way too much for their insurance policy it pays to be in the know.
Types of Coverage
Your homeowners insurance policy is going to do three things:
Protect your house from being flattened (or at least, rebuild it if it is).
Pay to replace the contents of your house if they're destroyed or stolen.
Protect you from the potential fiscal liabilities of people being injured on your property.
Structure Coverage
When you're determining the limits of liability you're going to need to protect your house from being destroyed you need to take into account the fact that your land probably isn't going to be destroyed by hail or fire. Yes, your grass might take a lickin', and it may or may not keep on tickin', but gardens and yards can be replanted for considerably less expense than you're going to pay to insure the land over the years. Check your appraisal and take out a home insurance policy for the value of the structure(s) themselves.
Property
One of the first things you should do when you get ready to buy your first home is take a careful inventory of the contents of your house. It's important to let your homeowners insurance company know if you've got jewelry or paintings of value that are going to need to be covered. It's not going to do you any good to try to file an insurance claims for them if you never declared them in the first place! Don't forget to include your electronics in this too. Televisions, radios and computers can get really expensive, really fast, so don't forget to make sure you're protected against a fire or a thief deciding to "liberate" them from the tyranny of ownership.
Yours, that is.
Personal Injury Liability
Did you know that if someone is injured on your property it's your fault, even when it's not your fault? For example, if someone you don't even know climbs over your back fence and into your pool without your permission, and they happen to be injured in your swimming pool, you're financially liable. That unpleasant nugget takes a lot of people by surprise.
You want your homeowners insurance coverage to be sufficient to protect you against the injury, property and potential lawsuit liabilities of owning a house, so it's important to make sure your levels are high enough. $100,000-$300,000 per incident is usually recommended, but that number may change as the cost of health care continues to rise so be sure to talk to your insurance agent before signing on the dotted line.
Buying your first house is exciting. Make sure it's protected by taking the time to do a little research and make sure you've got a homeowners insurance policy that will keep you protected no matter what life happens to throw your way.
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