Before you choose your home insurance policy, you need to strike a balance between affordability and adequate coverage. You want to minimize risk, but you also don’t want to overpay for insurance you’ll never use. Understand exactly what you want to insure and know the value of your coverage by avoiding these 7 home insurance mistakes.
1. Not Knowing the Value of Your Property
Failing to purchase enough insurance could leave new homeowners with thousands of dollars in uncovered damages and losses. If you discover you’re underinsured after the loss occurs, you may need to pay some replacement costs out of pocket. To avoid this risk, stay up-to-date on home values in your area so you know how much it would cost to rebuild and update your policy accordingly.
You can also track the value of your valuable items such as engagement rings, cameras, computers, and expensive antiques. It’s good to get these appraised to adjust for their true worth and adjust limits accordingly.
Also, consider home improvements. As time goes on, homeowners will likely make improvements such as renovating the kitchen, bathroom or installing energy-efficient additions When it comes to insurance, as many as 40 percent of home insurance buyers do not update their policy to match their improvements.
2. Thinking Deductibles are Fixed
While deductibles are fixed in general, this may not be the case for major weather events such as a hurricanes or windstorms. Damages from weather events may not be fixed but rather a percentage of a coverage amount. To help set expectations, ask an insurance agent about any changes in deductible amounts in accordance with the type of claim filed.
3. Figuring Sewage-Backup is Included
While homeowners assume standard coverage in their homeowner’s insurance policy, not all is included. Out-of-date sewage lines could lead to sewage backup, which could damage the entire structure of a home. A small addition to a homeowner’s policy can protect a new home should a situation arise.
4. Failing to Buy Flood Insurance or Earthquake Insurance
If your home is in a flood zone or an area of seismic activity, you may need to purchase additional insurance. Water intrusion and earthquake-induced losses can be confusing when it comes to home insurance policy, so be sure which water-related coverage you’ll need to cover your risks.
5. Not Asking for a Multi-plan Discount
When purchasing insurance, don’t forget to ask about multi-plan discounts. If you bundle auto, life and health insurance along with your homeowner’s insurance, agencies often offer discounts so you can save both time and money.
6. Failing to Shop Around
As with any pivotal decision in a homeowner’s life, homeowner’s insurance is not to be taken lightly. Shopping around is one of the most important tips for buying home insurance and the best way to choose the right one for you within your budget and for the coverage you need. Be sure to understand the key elements of different policies and the differences in pricing, coverage and flexibility.
7. Forgetting About the Policy After You Buy
After you purchase home insurance, don’t set aside your policy in a drawer and pay the annual premium without question. As your life moves forward, your policy may need to change as well. Annually, check your coverage amounts to determine if they’re still adequate.
Be Prepared and Drive Well with Allstate
Allstate Burbank can help keep you on your feet if you ever deal with any questions about home insurance mistakes Get in touch with us to learn more about how Allstate Burbank can protect you, and make sure to visit me on Facebook, Google+ and Twitter to stay updated on all the latest news from Allstate.
