Six Things You Should Know About Homeowners Insurance
By Jennifer Riner of Zillow
If you possess any large investment, you've likely familiarized yourself with the topic of insurance. Car, life, medical, dental, pet, travel – coverage takes many forms. Homeowners, in particular, usually protect their properties with insurance against unforeseen circumstances, including fires and natural disasters.
For new buyers who've only previously rented apartments in Pittsburgh, it's important to understand how homeowners insurance differs from renters insurance. Consider the following specifics before you start shopping for your home and purchase a policy.
1. Lender Requirements
Mortgage lenders typically require their borrowers to enroll in an insurance policy as part of their monthly payment plan. To best determine your monthly mortgage budget with homeowners insurance, use a calculator and input your budget details to view the breakdown. If you're purchasing your home outright with all cash, you won't be required to invest in protection. But, if you live in an area prone to earthquakes or flooding, shopping for homeowners insurance to protect your investment is often recommended.
2. Typical Coverage
The standard homeowners insurance policy covers storm, fire, theft and vandalism damages to property and possessions. This coverage can provide emotional relief when disaster strikes. The last thing a grief-stricken homeowner needs to worry about is money, and insurance allows those affected by tragedy to process material losses without stressing over financials.
3. Personal Injury Claims
If you have a visitor on your property and they are injured in a slip-and-fall accident, your policy provides liability coverage to cover medical expenses. Further, your homeowners insurance can also cover injuries caused by members of the household and even your pets – in case your dog injures a visitor or friend. Although policies vary, they can provide anywhere from $100,000 to $300,000 in coverage, with the option to increase.
4. Protection Outside the Home
Sometimes, belongings stolen from outside of the home, but still on the property, are covered by homeowners insurance. This may include anything from lawn furniture to a laptop inside of the car parked in the driveway. When something is stolen, ask your insurance provider if you're covered for the cost of reimbursement before you replace your items. You may be surprised at what your homeowners policy is willing to compensate.
Unless enrolled in a premium policy, homeowners insurance does not cover landslides, earthquakes, sinkholes, nuclear hazards, flawed repairs, poor workmanship, faulty zoning and often tornadoes and hurricanes in high-risk areas where extra coverage is required. If you live in a high-risk tornado or hurricane region, or have concerns your property might be subject to the these complications, speak with your prospective insurance representative about increasing your policy to protect your home.
6. Water Damage Rules
Rainwater or upper-level pipe bursts are typically covered through homeowners and renters insurance, but backed-up sewers and flooding are usually not, which is why residents of flood-prone regions should highly consider supplemental flood coverage in case of emergency. Water damage is not only exhaustive to clean, but can cost thousands of dollars in damages per every few inches of flood water.
Even when you aren't required to carry homeowners insurance, it's not a bad idea to research basic policies. Safeguarding all your major estates, including cars and homes, is part of being a prosperous investor.