[The following is a guest post by Annie Davis.]
So you've finally made your first huge purchase — a home. Congratulations! What's the first thing you should do? Protect your property, of course. Purchasing home insurance is the best way to protect yourself against the elements and other disasters. There are a few things that everyone should know about it, though. Here are a few tips that everyone should know about home insurance.
Understand What it Covers
The very first thing you should do when looking at an insurance policy is find out what the insurance policy covers. The policy, of course, covers things such as fire, storms, theft, and more. If you're displaced from your home, you'll be covered. Did you know that your homeowner's insurance can cover things outside of your house?
If something is stolen from your car, don't depend on your auto insurance. Your home insurance policy will likely cover anything taken from your car.
At the same time, understand what your policy doesn't cover. Most policies won't cover flood or earthquake damage as a standard item if you live in a high risk area. These scenarios requirepolicies that must be purchased separately. The same could apply for anything else, such as jewelry, furs or artwork.
Check to see if your insurance company offers these types of policies, and, if necessary, purchase them separate from your home insurance.
You Should Shop Around
Shopping around for your policy is important in finding the most coverage for the best price. If something were to happen, you're going to need someone you can depend on, so make sure to go with an agent that comes highly recommended. There's nothing worse than experiencing a tragedy and having an agent come out and tell you that you aren't fully covered.
How to Reduce Your Premium
It's important to maximize your discounts on your insurance premiums. Are you aware of all the different ways you can get a discount on your home insurance? If your property is gated, you can get a reduced premium. If you install other security measures, such as deadbolts, security cameras, alarms, or anything else, you can get a reduced premium. Adding an alarm that can directly communicate with the police and fire departments can earn you up to a 20 percent discount.
The less risks you have, the better. Do you have a pool? Put a fence around it. Little things around your house can lower your premium. Once you've installed all the security measures that you can think of, check out homeownersinsurance.com to compare rates and get quotes.
Don't Wait to File a Claim
Examine the policies to determine the time limits to report any damages. The last thing you want is to wait too long and not be covered. Commit the time limit to memory. If you decide to report the problem after the date, you're completely out of luck.
Note the Limitations
When signing up for a policy, it's important to make note of how much the policy covers. You'll be out a serious amount of money if the item lost or damaged exceeds the amount of money that the policy covers.
Keep Detailed Records
It's extremely important to keep detailed records, including receipts, contracts and appraisals. If you have a smartphone, you can use an app to record phone calls. Keep digital copies if possible, they're small and can be backed up remotely. The last thing you want is for a claim to not pay out based on your lousy records.
If you do decide to keep physical copies of everything, make physical backups of everything. Store them safely in fireproof cabinets or safes. In the event that something happens, you want them to be retrievable.
Bundle Your Policies
Consider bundling your policies. If you have multiple policies with one company, you could be eligible for a discount. If you hold these policies for three to five years, you could be eligible for a five percent discount, and if you hold the policies six years or longer, you could save up to ten percent on your premium.
Pay Attention to Inflation
It's important to keep up with inflation. The same house that cost you $75,000 a decade ago may cost you $110,000 to replace today. Talk to your agent to determine whether the coverage amounts still apply, and add any improvements to the total.
No matter if you're a first time buyer or have owned multiple homes, these tips can help everyone. Utilize them and get the most out of your coverage for the best price.
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