On average, American home buyers buy more than 14,000 properties every day, with more than 38% of the buyers being first-time homebuyers, as reported by the National Association of Realtors. Moreover, data from Statista show that there are over 80 million owner-occupied homes, and more than 85% of them have home insurance. This shows just how crucial home insurance coverage is in the US. With this in mind, you should purchase home insurance for your new home to protect your property from perils such as floods, fire, and strong wind. To get you started, here are three practical home insurance buying tips for first-time home buyers.
Check the Claims History
If you are buying a pre-owned home, chances are there have been previous claims made on the property. Since such claims may significantly affect your homeowners’ insurance policy in terms of premium rates as well exclusions, make sure that you are fully aware of them by reading the Comprehensive Loss Underwriting Exchange (CLUE) report of the property. This report will also give you an idea of the kinds of risks you should expect, as well as the amount of homeowners’ coverage you should carry. With this information, you can establish the right mitigating measures to alleviate the risks and possibly earn a discount on your home insurance premiums.
Know the Insurance Policy Exclusions
Most homeowners’ insurance policies have exclusions. For instance, most standard homeowners’ insurance coverage does not cover sewage backups and earthquakes, as reported by the Insurance Information Institute (III). This is because the majority of home insurance companies consider perils, such as floods and earthquakes, as high-risk perils. With this in mind, you should go through the fine print and take note of the circumstances under which the damage occurred can determine whether your claim will be accepted or denied. For instance, if your heater is off while you are away and water damage results from the bursting of freezing pipes, the insurance company may deny your claim citing negligence.
Keep Up with Your Insurance Needs
Currently, nearly two-thirds of homes in the US are underinsured, with some of the owners unaware of the state, as published on the Nation-Wide Website. To give you an idea, a recent survey indicates that about 30% of homeowners believe that the current market value of their homes is what determines their home insurance coverage costs, as published in the Insurance Journal. On the contrary, it’s the cost of rebuilding the house that determines the insurance costs. With this in mind, ensure you identify all the upgrades in your home and buy additional insurance for full coverage.
As a first-time homebuyer, you should use these tips when purchasing home insurance in Walnut Creek, CA. CF&P Insurance Brokers will help you get the right home insurance policy. Call (925) 956-7700 today for your free quote.