Purchasing a home – especially your first home – is one of the most exciting experiences of your life.
At the same time, it’s also incredibly complex, lengthy, and confusing. The end result of walking through the front door of a home you purchased is incredible, but it certainly takes a lot of work to get there.
As a young homeowner, you no doubt have many questions about insurance.
How much do you need? Does it cover flooding? What if someone’s injured in your home?
At Higgins Insurance, we want you to make an educated decision before signing any paperwork. We know it’s difficult to put a price tag on the value of your home and everything inside.
That’s why we put together a list of some critical questions you should ask your potential home insurance broker.
What Should You Ask a Home Insurance Broker?
Home insurance agents out to make a quick buck tend to assume young homeowners haven’t done their research. Knowing which questions to ask can make the difference between a high-quality, affordable policy and overpaying for cut-rate insurance.
1. How Much Will You Pay Out for My Home in the Event of a Total Loss?
When the worst possible scenario happens, you need to know that your home finances are in order. Always ask your home insurance agent how much you’ll receive in the event of a total loss.
If your home is completely damaged beyond repair and rebuilding is the only option, how much will your insurance company give you to rebuild? Is this figure reasonable based on your home’s value?
You should also consider where you’ll live if your home becomes inhabitable from a disaster such as a fire. Will your insurance company cover the costs to stay in a long-term hotel or temporary apartment.
2. How Much Will You Pay Out for My Possessions in the Event of a Total Loss?
Your homeowner insurance should cover the cost of replacing your possessions if your home is destroyed. What coverage options does the insurance company offer?
Conduct your own inventory noting appliances, furniture, electronics, and other valuables to come up with a reasonable estimate of your own. A good rule of thumb is to choose personal property coverage equal to about 60% or 80% of your homeowner insurance.
Keep in mind that your current plan may not cover any new items you purchase unless you speak to an agent. With Higgins Insurance, you can use our handy app to update your policy on-the-go anytime you need to.
3. Do You Pay Out Cash Value or Replacement Cost?
As you find yourself trying to rebuild after a disaster, that’s certainly not the ideal time to figure out the answer to this question.
If your insurance policy pays out cash value for your personal property, that means they’ll reimburse you based on the current value of your items. In other words, you pay for the item’s current worth factoring in depreciation. In this case, you may only receive $500 for a washing machine you bought ten years ago for $1,000.
If your insurance policy pays out the replacement cost, they’ll provide you with enough money to replace the item you lost with a similar item.
Ask your home insurance broker how they will pay out for personal property damage (and how long it will take).
4. Which Disasters Will My Policy Cover?
This is where home insurance policies get tricky. Many standard insurance policies may only cover fire damage, and even then, they may include wording that makes it difficult to file a claim.
In general, most policies won’t cover damage from water, wind, or sewage backups unless you explicitly add this coverage to your insurance plan.
It’s important always to read the fine print: never assume your policy will cover a disaster.
At Higgins Insurance, we’re committed to creating personalized home insurance plans that meet your unique needs at an affordable rate.
5. Which Types of Liability are Covered in My Policy?
Ask your home insurance broker plenty of questions about liability coverage. If someone is injured in your home or their property becomes damaged in your home, your liability coverage may very well cover them.
You can also expand your liability to cover you from any damage or injury your pets may inflict upon other people. Strong liability coverage can be a lifesaver if you find yourself facing a lawsuit because your dog bit someone inside your home.
Again, make sure to ask how to update your policy should your situation change and you need more or less liability coverage.
6. Do You Offer Any Discounts?
If you don’t come out and ask about discounts, insurance companies probably will not offer them. Ask your home insurance broker if you can bundle your home and auto insurance for a lower rate.
Some insurance companies may also offer discounts for homes with smoke detectors, burglar alarms, or sprinkler systems.
At Higgins Insurance, we want to make sure you never pay more than you have to for home insurance. That’s why we’re happy to offer a broad range of group discounts and bundling options.
7. Are You Available 24/7 to File Claims?
A disaster never strikes at a convenient time. (Is there any convenient time for a disaster?) When the unthinkable happens, you need to know that there’s a friendly voice waiting for you on the other end of the phone.
Higgins Insurance makes filing claims easy: you can get everything started through our handy app. We’re also just a phone call away anytime you need us.
Higgins Insurance Makes Home Coverage Easy
Higgins Insurance is one of the fastest growing independent insurance brokers in the Maritime provinces. At Higgins Insurance, we’re on your side. We believe in treating our clients like family.
As a family owned and operated business with over 20 years of experience, we’re committed to securing you the home insurance you need at the best rate possible.
Contact our friendly staff at Higgins Insurance today for more information about group rates and other discount opportunities.