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Home insurance cover loss and (some) damage of a home and the property in it. It is also a liability insurance. The purchase of home insurance is usually a requirement when applying for a mortgage for a house purchase; but it's also offers financial protection for the owner. This page is an introduction on how to buy home insurance.
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Disclaimer
The content in this page is not a substitute for professional financial advice. Please contact your financial adviser before using the information presented here.-
Home insurance cover loss and (some) damage of a home and the property in it. It is also a liability insurance. The purchase of home insurance is usually a requirement when applying for a mortgage for a house purchase; but it's also offers financial protection for the owner. This page is an introduction on how to buy home insurance.
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Introduction
- You might not have an option of whether to buy home insurance, as it's usually required when you apply for a mortgage. Even if you are not required to purchase home insurance, it's important because it offer you financial protection in case something happens to the house or its properties.
Step 1: Coverage
- Home insurance offers protection for the house and other property in it. It also includes liability insurance which protects you if something happen on your property.
- Earthquakes, floods and other natural disasters are usually not covered.
- For protection against floods, buy a flood insurance.
- For protection against earthquakes, buy an earthquake insurance.
- Damage or loss as a result of war is usually not covered either.
- Specific details of the coverage will depend on the plan and insurance company. As with anything, you usually get what you pay for - more expensive plans will have more extensive coverage.
Step 2: Research
- Do your research before signing up for a plan.
- Before starting to shop around for a plan, make sure you have the necessary facts available. You will need to provide a variety of information about the house and the land in order to get a quote.
- Shop around for a plan.
- Ask for details on what will be covered. Also ask to see (or receive, if the conservation is over the phone) a detailed written description of the insurance policy before you sign up.
- If you would like coverage for specific items or events which are not included in the plan, ask if you can buy special coverage for it.
- Find out if items will be covered by cash value or replacement cost. Cash value of an item decreases with time, while replacement cost is the actual cost of buying a new item.
Step 3: Savings
- Before purchasing a plan, find out if you can receive a reduced premium by any specific actions.
- Some insurance companies offer a discount if you buy both auto and home insurance from them.
- Ask if there are any home improvements you can do which would lower your premiums.
- For more information, visit Mahalo's guide on How to Save Money on Home Insurance.
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