Americans get a variety of different types of insurance to protect different things. For example, you may get health insurance to help cover hospital bills, car insurance to help pay for your car replacement in case of an accident, and even life insurance in case someone in your family passes away. If you have a home, it makes sense that you may want to protect it from losses and damage.
Homes are a big investment in terms of time, and especially money. Getting homeowners insurance, also simply called home insurance, can allow you to receive the finances needed in the event that something bad happens to your home that is out of your own control.
Why might someone want homeowners insurance?
Homeowners insurance may not be right for everyone, but most individuals and families in America may want to consider at least the minimum coverage. There are a few reasons for this, but the most obvious reason is obviously the peace of mind that you will get by preparing for the worst.
Choosing to go without homeowners insurance can result in huge repair or replacement costs in the event that your property is damaged, or even lawsuits to pay if the wrong person is injured due to problems with your property. But of course, making the choice to pay for annual homeowners insurance costs is a personal decision, which anyone can choose whether or not to make based on their personal finances and willingness to take the risk.
However, even though homeowners insurance is not required by law, many mortgage lenders will not give you a loan without it. This is all due to the inherent level of risk that these lenders are willing to take.
If a homeowner does not have insurance and loses their home due to a fire, they may have to spend the entirety of their bank account (or even go further into debt) in order to recover from it.
This means that their mortgage will have to go unpaid, which is less than ideal in the eyes of lenders. Therefore, by making at least some level of homeowners insurance mandatory, these lenders can have confidence that any future damages will be taken care of in the least painful way possible.
How to Get a Homeowners Insurance Quote & Submit a Claim
If you have decided that getting homeowners insurance may be the right decision for you, it is generally a good idea to not rush into a policy too quickly. One way that you can shop around for the right insurance policy is to request a premium quote from a few different companies.
As long as you are aware of your home’s value and the amount of coverage that you will need, you can easily compare prices of different companies’ annual premiums and decide which one is right for you. However, it is important to keep in mind that while a premium may be lower from one company to the next, that usually also meant that they have a higher deductible, or amount that must be paid out-of-pocket before insurance is able to cover the rest of the damage.
Then, once you have selected and agreed to the company and policy that best fit your needs, you must know the proper way to submit an insurance claim.
After a qualifying event that causes damage to your home has occurred, you must inform your insurance company as soon as possible. In the meantime between informing them of the damage and getting it fixed, you may purchase supplies to patch up that damage temporarily, which can be billed to your insurance later on.
After the insurance company receives your information about the damage, they will review that information for verification purposes themselves, or otherwise assign you a claim settlement expert known as an adjuster. Regardless, once your claim is properly verified, you will be able to receive your claims check in the mail that should cover the amount that your policy indicates for the damage that you have endured.
Your Responsibilities as a Homeowners Insurance Customer
As someone who has agreed to receive homeowners insurance, you have an obligation to be aware of how your policy works before attempting to use it. There are many things that a responsible homeowner must do to understand and maintain their coverage, including:
- Read the policy carefully: While this seems like a simple task, many homeowners do not read their policies carefully enough, and end up with payments that they were not aware of and surprises about what is covered and what is not covered by their plan. Ideally, this full read-through will occur before agreeing to the policy, so that you can ask your insurer questions in-person and ensure that you get the coverage that you want. However, if you have already received your policy, it is still important to read it carefully so that you are not taken off guard later on. One common mistake is not knowing when your premium is due every year. Missing this due date at all can result in losing your coverage.
- Try to limit the effects of a disaster on your property: There are many ways that people can make their homes safer, which goes a long way towards getting the most out of their homeowners insurance. This insurance does not apply towards damaged property that was preventable by the owner, which includes fire caused by not properly cleaning a chimney, water damage from a leak in a house’s shingles or structural damage from not obeying a room’s capacity limit. Additionally, investments like storm shutters and home security systems can help lessen the damage from weather and theft-related incidents. Making your home less of a risk can even potentially help lower your insurance costs.
- Document the status of your home & keep a list of your possessions: By keeping an inventory of all of your possessions and taking pictures of your rooms before disaster strikes, you can much more easily prove to your insurance company what damage has been done afterwards. This will make your claims process go much more smoothly as well, as you can easily remember and reference the exact items that you may have lost in a major event, such as a fire.
- Keep records of all of your homeowners insurance paperwork & correspondence: Keeping a detailed file of all of your payments, completed documents and conversations with the insurer can help to protect you from any wrongful blame.