Buying your own home can be thrilling, but the process and preparation of buying a home for the first time can also be intimidating. Help is here. We have some great tips for getting first-time home buyers the best home owner’s insurance coverage in Dallas.
Determining How Much Coverage You Need
Typically, the amount of coverage you need is based on how much it will take to rebuild your home, rather than how much the home is worth. Your personal possessions are typically calculated automatically at 75 percent for your home owner’s insurance policy. For instance, insuring your house for $300,000 will mean your belongings are usually covered for $225,000. Exceptions and limits will be listed in your policy, such as a limited coverage on jewelry or artwork. Check with your agent to see if you need additional coverage for special items or collections you may own.
Choosing a Deductible
When selecting a deductible, you’re determining an amount you will be able to spend out of your own pocket when suffering a loss. This should be the maximum amount you would consider easier to pay a repairman than get your insurance involved in a claim. The higher the deductible, the more you can save on your premiums. Deductibles in Texas are calculated as either a percentage or a dollar amount of the home’s value. Choosing a deductible of at least one percent can help in reducing your premiums. This will also deter you from filing smaller claims. New home buyers sometimes make the mistake of getting a lower deductible, then filing minor claims against it. This can count against you, raising your risk of the insurer dropping you or preventing you from getting a previous discount.
Comparing Price Quotes
Contact different insurance companies to compare home insurance quotes. You may want to begin by contacting the insurance group that covers your vehicle since discounts may be available for covering multiple assets. If you work with an independent agent, they are able to work with several companies and save you time and money by getting quotes from different insurers for the best price.
Combining Insurance Payments with Your Mortgage
Once you decide on an insurance company, give this information to your mortgage lender before you close so they can escrow your payments for mortgage and insurance together. When you make each mortgage payment, it will include part of the home owner’s insurance policy premium for that year, which will go into your escrow account. Then the lender will make your insurance payment for you, taking the payment from that account. This will help you avoid a big insurance bill at the beginning of each year.
The hope is you won’t ever experience a loss in your new home. However, it’s wise to take an inventory of your belongings. If you ever need to file a claim, you’ll have all the information handy. Go to each room, taking either video or photos of your possessions. Keep a copy of your inventory records and receipts for valuables away from the house, such as in a safe deposit box. Before they will hand over the keys to your new place, the mortgage company will require you to have coverage lined up at closing. Let Steven Graves Insurance Agency help you be prepared when you buy your first home in the Dallas Metroplex. Contact us to compare home insurance quotes and get sound advice on the amount of coverage and deductibles you’ll need for your new home.