Buying your first home is one of the biggest milestones in a person’s life. It’s a major accomplishment, and you should celebrate it. But while you’re celebrating, don’t forget to take steps to protect your home, too.
No one wants to think about something damaging their new house, but it’s always a risk. That’s why protecting your home with insurance is so important. You’ll have better peace of mind and financial protection if your home needs repairs or rebuilding.
The hardest part is often taking the first step to find the right homeowners insurance plan for your needs. Here’s good news: This guide will walk you through policy basics of home insurance for first-time buyers, optional coverage to consider, and how to compare providers.
What First-Time Buyers Need To Know About Home Insurance
While homeowners insurance is not required by law, your mortgage lender may require you to purchase coverage. Your lender wants to be sure that if something happens to your home, such as a fire or weather damage, and you can’t repay the loan, they will still be able to recoup their money. Insurance provides that financial protection for the lender.
One of the most important things to understand when shopping for first-time homeowners insurance is what homeowners insurance covers. A typical policy covers things like:
- Dwelling: Structural damage to your home and other structures in covered events such as fire, windstorms, vandalism, and lightning strikes
- Personal Property coverage: Covers the replacement cost for personal property damaged or lost in a covered event
- Personal liability coverage: Financial protection in case someone gets injured on your property
- Loss of Use: Payment for additional living expenses like temporary housing, meals, and related expenses if your home is no longer usable after a covered event
Keep in mind, your homeowners insurance policy generally will not cover flood damage or damage from earthquakes. If you’re worried about your home getting damaged in either of these types of events, consider purchasing separate earthquake or flood insurance. You can also buy optional disaster coverage to fill any coverage gaps.
Optional Add-Ons and Common Gaps
You have to decide how much financial risk you’re willing to accept when it comes to possible damage to your home. Depending on how likely you think certain types of damage are and how much protection you want, you can add these optional coverages to fill common coverage gaps:
- Flood Insurance: Flood damage can be incredibly destructive in a home, and it’s not part of standard homeowners insurance for first-time home buyers. Consider adding it if you’re worried about flooding in your location.
- Earthquake Insurance: Similarly, damage from earthquakes is likely not covered by your standard plan. If you live in an area with frequent quakes, consider earthquake insurance.
- Sewer Backup: You'll likely need additional coverage to pay for repairs and replacement after your water or sewer backup overflows.
- Inflation Protection: This optional add-on increases your home insurance coverage limits to keep pace with rising construction and repair costs resulting from inflation.
How To Compare Providers and Get the Right Coverage
Selecting a company to provide your house insurance as first-time buyers is almost as difficult as choosing the house itself. Here are the key things to look for in insurance providers to make sure they’re the right fit:
- Coverage options: Does the insurer provide all the coverage you want in your homeowners insurance policy? While you can get coverage from multiple providers, it’s generally more convenient and cost-effective to work with just one.
- Customer Service: Does the company have a strong reputation for providing excellent customer service and processing claims efficiently? How user-friendly is the claims process with that insurer?
- Pricing: Does the company offer fair prices and discounts that help bring down your insurance quote without reducing your coverage amount?
Consider bundling your home insurance policy with your auto insurance or other coverage to get a multi-policy bundling discount.
And if you want to reduce your premium costs, you can always weigh choosing a higher policy deductible. With a higher deductible, your yearly home insurance premiums can be significantly lower. However, the trade-off is that if you need to file a claim, you’ll have to pay more out of pocket before your insurance company will pay toward repairing or replacing the damage.
Get Personalized Quotes for Your First Home
There’s so much to do when you’re buying your first home. It’s an exciting time, but it can also be stressful and a lot of work as you try to get through your to-do list. Don’t let buying home insurance become another tedious, time-consuming task.
Instead, use EverQuote to compare personalized home insurance quotes. It's quick and easy to find the best deal on the home insurance coverage you want. All the information you need to make your decision is right in one place.
Get your customized home insurance quotes from EverQuote now, and rest easy knowing you found great insurance at a great price.