MONDAY, MARCH 6, 2023
Both new homeowners and veteran homeowners can fall into common pitfalls when it comes to homeowners insurance. Homeowners insurance isn’t always straightforward, and mistakes are often made when it comes to coverage and compensation. Make sure you don’t fall into these common mistakes with your home insurance policy.
Overestimating How Much Home Insurance You Have
A lot of homeowners purchase a basic home insurance policy and assume that they are covered for any incident. Unfortunately, a basic policy won’t always cover you. Make sure you have at least 80% of your home’s total replacement cost value in home insurance. Keep in mind that there are common exclusions on home insurance, such as damage caused by floods and earthquakes. Your expensive items, such as jewelry, furs and art, may need to be covered under additional policy floaters.
Waiting Too Long to File a Claim
When an accident happens, you usually have a time period afterwards in which you must file a home insurance claim to receive compensation. This is usually a 30-day period but can vary depending on your policy. Waiting too long to file an insurance claim can leave you without compensation for damages.
Having a Deductible that is Too High or Too Low
Your home insurance deductible is the amount you will pay out of pocket after an accident. A higher deductible can save you money on monthly premiums, but this also means paying more out of pocket if you have to file a claim. A deductible that is too high can make it difficult to pay when you need to. On the other hand, a deductible that is too low can result in high monthly premiums.
Not Notifying Your Insurer of Changes
It is important to keep your insurer in the loop about changes around or inside the home. If you make certain upgrades or purchase expensive items without notifying your insurance provider, those new upgrades may not be covered in the event of an accident or natural disaster. Notifying your insurer of certain upgrades may also save you money on home insurance premiums if those upgrades serve to make your home safer.
Choosing Insurers Based Only on Price
While it is important to save money on home insurance, it is also important that you take other aspects of insurers into consideration. You should take into account the insurer’s reviews, locations, coverage offerings, available discounts and more.
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