Homeowner’s insurance isn’t just something that is recommended for new homeowners – it’s most certainly a requirement. If you’re the owner of a brand new home, it would be absolutely devastating if something were to happen to it. Even if you take precautions to prevent something like a home invasion or break-in, for example, fires and other disasters can lay waste to the best of intentions. By understanding just a few key things about new homeowners insurance policies, you can help make sure that, not only are you getting the policy that best suits your needs, you’re getting one that will actually protect both you and your loved ones in the unfortunate event that you really need it.
One of the most important things to understand about a new homeowners insurance policy are the many factors that go into determining the rates that you’ll pay on a monthly basis. Homeowners insurance policy rates are based on a number of things, including the total value of all the items contained inside.
In the event that you suffer a total loss, and every item in the home (and often the home itself) needs to be replaced, the insurance company wants to know ahead of time how much money it would be forced to pay out in that type of situation. As a result, before you can get your new home insurance policy, you will have to go through and estimate the cost to either repair or replace every item inside.
Finding the value of these items is a straightforward process, though it will likely be time-consuming. You will need to go room-by-room, and make an itemized list of every item inside. You will, then, need to use various resources, including the Internet and any receipts that you’ve kept over the years to find the approximate value of each item. In the event that you need to file a claim against your homeowner’s insurance policy to cover the price of your new television set, for example, you’ll need to know how much it would cost to buy a new or equivalent model. This same logic is true for every item inside your home, including family heirlooms.
Homeowner’s insurance policies are based, in part, on risk, meaning that people who are deemed “risky” by insurance companies will be charged more on a monthly basis for service. As a result, the purchase of a new home is a great opportunity to take advantage of certain discounts that most carriers offer.
If you install a fire sprinkler system or other fire safety equipment inside your home, for example, your home will be deemed safer than one without those features, and your rates will go down as a result. Installing a security system to fend off would-be home invaders and other precautions are also all great ways to lower your monthly insurance bills.
Another important factor that goes into determining how much you’ll pay has to do with the area in which you live. Statistics play a hugely important role in the eyes of an insurance provider. If you live in an area that is high in crime like home invasions, for example, you will naturally pay more money in homeowners insurance than someone who lives in a safer area.
The same logic is true for the car you drive. If you drive a car that is statistically stolen very often, you’ll pay more money for insurance than a person who drives a different make and model. The area can also help you when it comes to your rates, however. If you live down the street from a police station, you will likely receive a discount as a result.
Still have questions about home insurance? No problem! Contact our office by phone, email or in person, and let one of Atlantic Pacific Insurance’s experienced insurance agents assist you.
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