What You Need to Know About Home Insurance Coverage

Woman goes over home insurance coverage basics at her dining room table

Whether you’re a first-time homebuyer or looking for a new home insurance policy on the house you’re already in, comparison shopping is key to finding homeowners insurance at the right price for you. Here are some basics for anyone seeking home insurance coverage.

Homeowners Insurance Coverage Basics

Insurance policies can involve an immense amount of detail, leaving just about anyone feeling lost. Explore the basic types of coverage and terminology to help you start the shopping process:

  • Dwelling Coverage – Make sure your policy covers the total cost of replacing your entire home.
  • Personal Property Coverage – Find out just how much the policy will cover to reimburse the cost of your personal possessions.
  • Liability Coverage – Understand if or how well you’re protected in the event someone gets injured while on your property and files a lawsuit. 
  • Other Structures Coverage – If you have a detached garage, a shed, or some other structure on your property, make sure it’s also included in your coverage.
  • Deductibles – A deductible is the amount of money you need to pay out-of-pocket before your insurance payout kicks in. Lower out-of-pocket payments tend to mean higher premiums, while higher out-of-pocket payments tend to mean lower premiums. Only you can decide which option is right for your needs.
  • Policy Sub-Limits – Every home insurance policy has its limitations, especially when it comes to high-value items in your home. High-dollar items such as jewelry, fine art, rare coins, firearms, etc. will typically be covered, but only to a certain dollar amount. If the sub-limits in your policy don’t meet the value of your possessions, it’s recommended to consider adding a “rider” (or “endorsement”) to your policy that can increase the coverage for those items. Keep in mind, this will likely increase your monthly premiums as well.

When to Shop for Home Insurance

If you have a mortgage, home insurance is a must, as lenders will typically require you to have home insurance to complete the loan. As long as your lender holds the title on your home (i.e., until you pay off your mortgage), insurance has to stay current. You can change providers, but you have to make sure your home insurance coverage is up-to-date to protect your lender’s investment.

Using the above list of topics can help you put together an idea of the type of coverage you may need, but it’s helpful to know how much coverage you’ll want prior to shopping for your home insurance policy. The type of coverage and amount needed will play a role in rates available to you, but you’ll also be asked to provide some basic information, such as:

  • Name and date(s) of birth of the homebuyer(s)
  • Address
  • Coverage start date
  • Details on the home, such as year built, total number of finished square feet and any detached structures on the property
  • Safety features, including deadbolts, sprinklers, fire/smoke alarms, burglar alarm, etc.
  • Insurance history, including most recent property insurance carrier and dates of coverage
  • If you are looking for additional protection, such as an increased limit on technology or jewelry

Let SelectQuote Help You Find the Best Homeowners Insurance For You

Securing home insurance can seem complicated, but it doesn’t have to be. At SelectQuote, we simplify the process by getting to know your needs and finding you the best homeowners insurance available to you from the trusted insurance companies we work with. In just minutes, we can provide you with multiple home insurance quotes. Let us do the hard work for you.

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