If you’re a Millennial who recently purchased their first home, congratulations. This is an exciting accomplishment and investment you’ll want to protect by buying the right home insurance.
Getting home insurance can be overwhelming, especially if you’re a first-time homeowner. As such, you may search for help from your parents if they are experienced homeowners, along with a home insurance agent who can offer expert insights into how you can insure your residence properly.
So what does it take to find the right home insurance? There are many questions you should ask both your parents and home insurance agent, including:
- What does home insurance cover?
It is important to note that not all home insurance policies are created equal. Even though every policy will cover the structure of your home, your personal property and your personal legal responsibility (or liability) for injuries to others while they’re on your property, there are other factors to consider as well. You may want to look into purchasing an “umbrella” policy for your home. This policy ensures you’ll be protected against major claims or lawsuits and includes extra liability coverage.
To better understand what a typical home insurance policy covers (and what it does not cover), your parents may be able to provide you with a copy of their home insurance policy that you can review. Comparatively, meeting with a home insurance agent can help you find out exactly what is covered under a specific policy.
- How much should I insure my home for?
Your parents may have insured their residence for a specific amount, but you should meet with a home insurance agent to get a better idea about how much insurance is necessary for your residence.
Beyond the purchase price of the home, it is crucial to consider the total cost it would require to replace your home if it is damaged or destroyed.
A home insurance agent will be able to evaluate the estimated cost to replace your house. In fact, this agent will likely possess state-of-the-art evaluation tools that he or she can use to help you insure your home for the right amount.
- Does home insurance cover the cost of flood damage?
Even if you bought a home outside of a floodplain, that doesn’t necessarily mean you’re out of the woods as far as floods go.
Did you know that about 30 percent of residential flood damage occurs in homes outside of floodplains? That’s right, and even a 1/2 inch of water may be considered a flood.
Home insurance does not cover the costs associated with flood damage, and as such, it usually is a great idea to add flood insurance to complement your home insurance policy.
Regardless of whether or not your parents have flood insurance, you should consider it for your new home. Remember, even a small amount of water can cause lasting damage to your residence, and if you don’t have flood insurance, you may be required to cover the costs associated with repairing this damage.
- Will my home insurance cover my personal belongings?
Your parents may or may not have specialized coverage that accounts for various personal belongings. If desired, a home insurance agent can outline numerous coverage options to help you insure your treasured items against loss due to theft.
Specific items like collectibles, guns and jewelry may be covered in your home insurance policy against loss due to theft—but only for a specific amount. Thus, those who want to add extra insurance for personal belongings should meet with a home insurance agent to discuss their options.
- Are there any discounts available?
Bundling your auto and home insurance may help you save money. Plus, if you’ve been using an auto insurer in the past, you may be able to streamline the process of setting up your home insurance with the same provider.
Ultimately, the cost of your home insurance should be a consideration in the process of finding the right insurer, but this factor should not hold the key to your decision-making process. Even though your parents may prioritize finding the lowest price for home insurance, you should focus on finding a home insurance policy that will provide you with the coverage you need at all times.
Both parents and home insurance agents are focused on the same goal—helping you get the right home insurance for your new home. By asking these questions, you’ll be well on your way to maximizing the value of your home insurance policy and getting the coverage that fulfills your individual needs.
Ryan Hanley is the Vice President of Marketing at TrustedChoice.com and the Managing Editor of Agency Nation. He is also a speaker, podcaster and author of the Amazon best-seller, Content Warfare. Ryan has over 10 years of insurance expertise and blogs frequently to help consumers understand complicated insurance topics.