Home Insurance Basics You Should Know

Home Insurance Basics You Should Know August 9, 2011

Owning a home is one of the most important and most expensive purchases a person can make.  Unfortunately, there are risks that can destroy a home in minutes. Those risks can include fire, flood, or any other untold event that could damage the house, such as a tree falling on it in a windstorm. This can prove to be quite costly, especially if the home hasn’t been insured. That’s why getting the home insured is the most important thing you can do for yourself once you have signed on the dotted line to buy a home.

Most mortgage lenders these days require the homeowner to get home insurance, especially if the owner is still making mortgage payments on it. When taking out home insurance, it is also important to make sure that you are not over-insuring or underinsuring for that matter. So how do you decide on the best home policy for the most reasonable price? For starters, it should at least cover rebuilding costs of a home, not necessarily the market value. This brings matters to the next point and that would be the two basic types of insurance policies for homes. One type covers the house or the structure and other covers the contents of the home.

Strictly speaking both of these are two different types of policies. It is also possible to take each one of these from two separate insurance companies. However, getting them from one provider will ensure the cheapest home insurance premiums. The good news about having many companies to choose from is that the more players there are, more competition there will be. The bad side is of all this is that you need to be careful before committing with one. This is because they may offer all sorts of goodies that are simply not true, just to get your business.

The first place to start looking for good prices is the internet.  Look for reviews from satisfied and unsatisfied homeowners and keep track of reputable companies.  As mentioned before, it can really be cheaper to go with one company, especially if you combine other possessions such as your car.  Finally, look for ways to lower your premiums.  Fire or burglar alarms installed in the house can mean discounts for your home insurance. Last but not least, location of the house can also affect the premiums. If the home is located in an area prone to fires and other natural disasters, then naturally the premiums will be higher.

This post was a guest post from Elijah.  Let us know if you would like to write for us.

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