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As a new homebuyer, one important task on your to-do list is selecting a homeowners insurance policy. Homeowners insurance provides financial protection in case of damage to your home or personal property, and it is typically required by mortgage lenders. However, with so many options available, it can be difficult to know which policy is best for you. Here are five things to consider when comparing homeowners insurance:
- Coverage limits
Homeowners insurance policies typically have limits on the amount of coverage provided for your home and personal property. It is important to choose a policy with coverage limits that are appropriate for the value of your home and possessions.
3 Simple Steps to Shop Homeowners Insurance | SELFi
- Deductibles
A deductible is the amount of money you have to pay out of pocket before your insurance policy kicks in. Higher deductibles can result in lower premiums, but it is important to choose a deductible that you can comfortably afford in the event of a claim.
3 Simple Steps to Shop Homeowners Insurance | SELFi
- Coverage exclusions
It is important to carefully review the exclusions in a homeowners insurance policy, as there may be certain types of damage or events that are not covered. For example, some policies may not cover damage caused by earthquakes or flood.
- Additional endorsements
Homeowners insurance policies may offer additional endorsements, or riders, that provide coverage for specific types of items or events. These can include coverage for jewelry, valuable art, or home-based businesses. Consider whether you need any additional endorsements to fully protect your home and possessions.
- Reputation and financial stability
It is important to choose a homeowners insurance company with a good reputation and financial stability. Look for a company with a history of paying claims promptly and fairly. You can check the financial stability of an insurance company by reviewing ratings from independent agencies such as A.M. Best or Standard & Poor’s.
By considering these factors, you can find a homeowners insurance policy that provides the protection you need at a price you can afford. Don’t be afraid to shop around and compare quotes from multiple companies to find the best policy for you.
Shopping homeowners insurance could help you reach your financial goals sooner.