Getting home insurance can seem extremely difficult. It can be hard to know how much insurance to get, what coverages you need, and what’s a good rate. To help you on your home insurance mission, we’ve got 8 common home insurance mistakes for you to avoid as you set your coverage. We’ve also included a home insurance tip for each one.
Avoid these home insurance mistakes.
1. Not getting enough home insurance.
Home Insurance Tip #1: Ideally, you should have enough home insurance to do the following three things:
- Rebuild your house from the ground up if it’s damaged.
- Replace all of your belongings.
- Cover your liability.
You need to make sure that you have enough home insurance to rebuild your home completely if it’s destroyed by a fire or another loss. That means you have to consider the extra costs of construction and clean up. This is your home’s reconstruction value. Rather than insuring your home for its market value, it’s a good idea to insure it for the reconstruction value so you have enough coverage to account for the cleanup and construction (which are very expensive.)
It’s also important to take a home inventory so that you know how much coverage you need for your personal belongings – and that way you’ll know exactly what to claim if you have a loss to your home.
Basically, the point is to make sure you’re not underinsured. You need enough coverage to protect you from financial loss if your home is damaged or destroyed.
2. Setting a deductible that’s too low or too high.
Home Insurance Tip #2: Set a deductible that fits your finances.
Your deductible is the amount you agree to pay if you have a claim. You’ve got your portion of a claim and the insurance company takes care of the rest. So, if you have a claim that’s $5,000 and your deductible is $1,000, you’ll pay $1,000 and the insurance company will pay $4,000.
Your deductible is important because it relates to your home insurance rates. If you set a deductible that’s higher, you could see lower premium because you’re less likely to file a claim. But you don’t want to set your deductible so high that it would be burdensome to pay if you ever have a claim. It’s a bit of a balancing act. You have to evaluate your finances and decide how much you can comfortably afford to pay in the event of a claim. If you find you could raise your deductible, you might see lower rates.
3. Not asking about home insurance discounts.
Home Insurance Tip #3: Be sure to ask about discounts.
Many home insurance companies offer discounts for home insurance. Be sure to ask your agent what discounts they offer and see if you qualify for them. Some common home insurance discounts are…
- Having a monitored burglar alarm or security system.
- New roof.
- Bundling your home and auto insurance.
- Being claims-free for a certain number of years.
- Home improvements (new wiring, plumbing, AC system, roof.)
4. Not adding coverage to account for exclusions.
Home Insurance Tip #4: Make sure to cover any gaps in your home insurance policy.
Unfortunately, home insurance doesn’t cover everything. Certain losses aren’t covered (and these losses are called exclusions.) Some common – but surprising – home insurance exclusions are…
- Sewer backup
- Jewelry (Most policies only offer limited coverage for valuables.)
You have to make sure to cover any gaps in your home insurance. If you want flooding to be covered, you have to get flood insurance from the National Flood Insurance Program (NFIP) through an agent. If you want sewer backup to be covered, you have to add that coverage to your policy. If you want all of your valuables to be covered, you have to add extra coverage for your jewelry and other treasures.
Be sure to discuss these things with your agent and ask questions about what is or isn’t covered.
5. Choosing coverage based on price alone.
Home Insurance Tip #5: Keep in mind that the lowest price might not be the best home insurance policy.
Yes, it might be tempting to choose the cheapest coverage available, but cheapest doesn’t mean best. It’s a good idea to really explore your options and compare coverages. You also have to make sure you’re looking at an apples-to-apples comparison of home insurance coverage when you consider pricing. Then consider the insurance company itself. Do they have a good reputation? Will they truly be there for you if you have a loss? You might find that the best option costs a little more than the cheapest option, but the extra expense could be well worth it.
6. Not telling your agent about home renovations.
Home Insurance Tip #6: Keep in touch with your agent and let them know about planned home insurance renovations.
If you do renovations to your home, you could be adding significantly to its value. That means that you might need to add home insurance to make sure that you still have enough coverage for your home.
Also, if you have to move out of your home for a while as the renovations are being done, you may need to get vacant home insurance. Many policies will not continue to protect the home if no one is inhabiting it.
7. Not reading through the home insurance policy thoroughly.
Home Insurance Tip #7: Take the time to read through your policy.
The only way to really understand what your home insurance policy does and does not cover is to read through it carefully. It’s important to read through the policy, tedious as it might seem, so that you’re aware of how your home insurance will handle various situations. If you have any questions about all the “insurance-speak” in your policy, don’t hesitate to give your agent a call to clarify. It’s better to be equipped with knowledge when it comes to handling your home insurance.
8. Not shopping for home insurance.
Home Insurance Tip #8: Get multiple quotes for Atlanta home insurance.
When you get home insurance in Atlanta, its’ a good idea to shop around for multiple quotes. That way you’ll be able to compare coverage options and pricing. By shopping, you give yourself the change to save money on home insurance. You might find comparable coverage from a comparable company – but at a lower rate than the other guy’s offering. Though it might be tempting just to go with the first quote you get, a little patience can go a long way.
Speaking of shopping for home insurance, our agents can help you get multiple quotes for Atlanta homeowner’s insurance. We’ll shop your rates and go over your options for coverage, and we’ll make sure that we understand your unique situation so you get the coverage that’s right for you. Get started with your Atlanta home insurance by filling out our quote form or giving us a call today!