There's a lot to take into consideration when you're shopping for homeowners insurance. From deciding how much coverage you need to figuring out which insurance carrier is best for you, the process of shopping for homeowners insurance includes a lot of decision making. As you explore your options, however, there are a few things you'll want to remember. These mistakes are most common among first-time home buyers, but they could apply to anybody.
Choosing the Wrong Deductible
Most home insurance carriers give their policyholders the ability to decide their own deductible. This is the amount you'll need to pay out-of-pocket when you make a claim before your full coverage benefits will kick in. Some will opt for a high deductible in order to reduce their monthly insurance payments, but keep in mind that if you go this route, you'll want to make sure the deductible amount is still something you'd be comfortable with paying if needed. On the other hand, a low (or zero) deductible may cost you more each month but will give you added financial freedom if you need to make a claim at any point.
Failing to Take Advantage of Discounts
There are so many home insurance discounts available these days; make sure you're taking advantage of all the ones to which you may be entitled. For example, did you know that you could be eligible for a discount if your home has a security system or surveillance system? Some insurance companies also offer discounts for certain home upgrades, such as basement waterproofing or metal roofing (both of which put you at a lower risk of needing to file a claim). Discounts can vary greatly from one insurance carrier to the next, so be sure to shop around here.
Not Understanding Water Damage Stipulations
While most standard home insurance policies include coverage for water damage, it's important to understand that this often doesn't include damage caused by flooding. If you live in a known flood plain, you'll want to purchase specialized flood insurance coverage (and your mortgage company may actually require it). The water damage coverage included in your policy probably only covers against damages related to roof leaks, plumbing leaks, and the like, but check with your agent to be sure.
By avoiding these common mistakes while shopping for home insurance, you can find the policy that's right for you — and at a price that's within your budget.
Contact an insurance agency like Crowel Agency, Inc. for more information.