Top 12 things homebuyers should know about homeowners insurance!

When purchasing a home, homebuyers will need to start looking for homeowners insurance.  Where to start?  There is a lot of misconceptions when it comes to homeowners insurance policies- what you need, what you don't need, what would be a really good idea to have, how much it affects your monthly payment, and so on.  Even something as simple as understanding the lingo can be confusing!  Check this website for a complete list of definitions!
Insurance salespeople have one of the easiest sales jobs in the world: they’re selling fear. Selling an emotion is incredibly profitable, and fear is an incredibly strong emotion. However, a lot of times that fear is real, especially when it serves to protect one of the biggest investments you’ll ever make: your home.
Although no one likes to dwell on the “what ifs,” it’s important to protect yourself against the unexpected. Feeling the security that comes with knowing your home is insured is worth a lot more than a monthly payment.

Here are the basics Fox Business reports every homeowner should know about home insurance:

1. Make sure you not only shop around for a policy, but for the best agent too. Insurance agents can help you get back on your feet after a disaster or make the situation feel even more impossible.
2. A typical policy covers damage to your property and possessions in the event of theft, fire, or vandalism (even if the possessions are outside of the home) and provides liability coverage if someone is hurt on the property and sues. It also covers shelter costs, meaning if you’re displaced you won’t have to pay a lot of money out-of-pocket for your temporary residence.
3. A standard policy doesn’t cover earth movements (earthquakes, sinkholes, landslides), war, nuclear hazards, power failure, faulty zoning, government action, defective maintenance, bad workmanship, faulty repairs or flooding. In general, water damage from above (think rainwater or a burst pipe) is covered, while water from below (think flooding) isn’t.
4. You may need to get supplemental coverage if the region you live in is prone to natural disasters like earthquakes, flooding, hurricanes or tornadoes.  In Onslow County, North Carolina, it's required to have a separate wind and hail policy as well as a homeowners policy.
5. Understand the difference between market value and replacement cost. Before deciding which type of policy to purchase, understand what you’re paying for. Market value is how much a buyer would pay for your home in its current condition (after a natural disaster, fire, etc). Replacement cost plans cover the repair or replacement of your entire home.
6. Reduce premiums by installing working smoke detectors, deadbolts, a burglar alarm system, a pool cover, and a fence around the pool. Reducing liability equals a reduced premium.
7. Bundling your home insurance with other policies like your life or car insurance can also save you money.
8. Make sure to take note of the time limits to report a claim. If something happens, make sure to get your claim in on time or else you risk being ineligible for benefits. Furthermore, waiting may make the problem worse.
9. Keep records of all claims. Document everything that occurs during a loss to mitigate a claim being denied or not being paid in full. Save contracts, appraisals, and receipts and document phone calls.
10. Keep an eye on your systems. Have routine check-ups done on major systems. If you’re able to make a smaller fix due to your early detection and prevent a bigger claim, your insurance company will most likely reward you.
11. Note your policy’s limit on jewelry. Get an appraisal for how much your jewelry costs, and then consider buying a supplementary policy to cover what your home insurance doesn’t.  In North Carolina, you automatically have a higher coverage limit on firearms than you do on jewelry.  If you own more valuable jewelry, it might be worth discussing getting an additional policy to cover it.
12. When in doubt, file a claim. The worst that can happen is it gets denied. This best is that you get a new roof because of a windstorm and a few missing shingles. Don’t file frivolously though, only file claims you’re certain and on the fence about, because filing needlessly could lead to an increase in your premium.  Your insurance agent can help guide you through this process, as well as help you determine if it's worth it or not.

Although thinking about everything that could go wrong with your home can be overwhelming, it’s necessary. Protecting your biggest investment is one of the best decisions you can make; after all, once a house becomes a home, it’s priceless.
When purchasing a home, our team can share with you several reputable insurance agents' information so that you can confidently shop around and have a thorough understanding of what your homeowners insurance policy covers, and what it doesn't!