First Time Home Buyer? Here’s What To Look Out For!
So you finally found the home you are going to buy. After searching for months, saving up a down payment, finding what you really want…you finally snagged that home! Whether you borrowed through a mortgage or saved up to buy a house outright, we need to talk about savings strategies!
Why You Need A Home Insurance Policy
Now, what happens if it all goes away? Fires happen when least expected, and water can damage a property far more than anything else. This can happen while you aren’t even aware there is damage. I don’t want to scare you, but after 5 years in insurance, I have seen everything that could happen. I have seen someone buy a house and have it burn down within a week. Another time, someone removed their coverage for sewer backup. Well, a month or two later, they experienced their first sewer backup in 20 years of home ownership!
This is where home insurance comes in. Your mortgage will require that you purchase fire insurance in order to qualify for a mortgage. However, I recommend you buy more than fire insurance. For a start, the coverage is too basic. It can actually cost more than a fully comprehensive home insurance policy. While home insurance may seem like a large cost, it is one of the smallest investments you can make in protecting your home.
What A Home Insurance Policy Covers
A typical home insurance policy will cover fire, lightning, smoke, pipes bursting, vandalism, theft and attempted theft, windstorm, and hail. However, your insurance broker will walk you through the process. This is so you can find the right match for your needs and budget. Your broker will also go through what types of losses are not covered automatically but can be added!
The Home Insurance Policy Process
The first step is a valuation of your property. This will ensure that it is insured to its correct value! This value, in 99% of cases, will be different from the amount that you paid. Your mortgage will require that you insure at least to the mortgage value. However, with insurance, we will look at full replacement cost. The replacement cost is the full cost to rebuild your house from the ground up. For example, this may include the removal of debris, in the event of a total loss to the house. I have seen situations where this amount is less than a person’s mortgage. I have also seen situations where this amount is significantly more than a person’s mortgage. In situations where this amount is less than the mortgage, we look to insure on a higher form of coverage. This is called a guaranteed replacement cost. I should note, however, this isn’t always available on a house. It depends on its age, as well as the updates done to the house.
What Information Should I Tell My Broker?
It is a good idea to come prepared before meeting with your broker! Some information you will know from having looked at the house. However, much of it won’t be readily accessible without having a home inspection completed. For instance, we would need to know a lot of information on your house. Some of these questions may include:
- What type of pipes are in the house?
- When was the last update to the plumbing?
- What type of electrical wiring do you have?
- How many amps is the electrical panel?
- What material is the roof and when was it last replaced?
- What kind of heating system is there?
- Is there a fireplace, and if so, is it a fireplace insert or a fireplace?
…The list goes on and on! If not all of this information is known, don’t panic. We can figure it out. Together we can work with you to obtain coverage for you. However, these are the three absolute must knows: 1) how many amps is the panel, 2) what type of wiring, and 3) is there wood fuel heating in the house? If you know these three answers then we can generally get you coverage with the listing details.
Are You A First Time Home Buyer? Contact Campbell & Haliburton Insurance
- Give Campbell & Haliburton a call at 306-757-0621
- Send us an email or contact Campbell & Haliburton online
- If you are comfortable, please stop by our office and we can talk in person. We are here for you.
As you walk out of our door, you can do so with the assurance that you are covered with the home insurance that best meets your needs. If you don’t have an insurance broker and want to talk to someone who is truly passionate about your insurance, contact us at Campbell & Haliburton Insurance. We would love to talk to you.
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**(This is a general overview. There are many different insurance companies and there are always differences in insurance policies. For specific details on your policy and coverage, we recommend that you contact your agent or broker).