There are a lot of things you need to think about when you buy your first home and insurance is pretty high on that list. In fact, if the home has a mortgage on it, the insurance is not optional. There are minimum requirements when it comes to insurance coverage, and they can vary from state to state or even by the lender, so you need to make sure that you get the requirements from the bank and buy the coverage that is required.
Primary Coverage
The policy you buy for your home will cover a variety of things, but the coverage amounts can be the big difference in the policies. In most cases, there is a minimum requirement for the insurance, and while it is cheaper, it is not always the best option. While it will meet the bank's standards, it may only offer enough protection to cover the investment and nothing more. If you were to have a fire or some other devastating event, you want to have enough coverage to be able to recover from it and repair the damage or rebuild, not just cover the loan. If you are not sure how much coverage you have or need, talk with your insurance agent about any concerns you have so you can come up with a coverage package that works for you.
Specialty Coverage
If you live in an area that requires additional insurance coverage, you should be made aware of it by the lender, but the insurance agent you work with will be able to tell you what else you need to consider. For instance, if you live in a floodplain, you will need flood insurance through the federal government. While most people know that they live in an area that could flood, not everyone knows how or where to get flood insurance. Flood insurance is offered through the National Flood Insurance Program and managed by the federal government. The amount of coverage you need is going to vary by area so you will need to do a little research into the amount of coverage needed.
Additional Coverage or Riders
Beyond the coverage needed for specific regions or areas, there may be things on your property you would like to have coverage for. If you have a valuable car you have restored and is parked in the garage or some very expensive or rare furnishing that cannot be easily replaced, you might want to have additional coverage that extends to those things. Talk to your agent about these kinds of things because the insurance options can be different from one company to the next, and they will be able to get you headed down the right path.
To learn more, reach out to companies like Boone Ritter Insurance.
