If you’re buying your first home, it’s normal to have questions about homeowners insurance. Although it’s not legally required, most mortgage lenders will mandate you purchase homeowners insurance to receive a loan. This article contains answers to commonly asked questions about homeowners insurance.
What Is Homeowners Insurance?
Homeowners insurance, also called home insurance, is a legally binding contract between you and your insurance company. In exchange for your home insurance premiums, your insurer will pay for covered losses up to your policy limits. Home insurance is essential to protect your property from damage.
Why Is Homeowners Insurance Important?
Owning a home comes with risks. Here are some examples of financial losses that could arise at your home:
- If your property is damaged or destroyed, you could face significant repair and replacement costs.
- If someone is injured on your property, you could face costly personal liability lawsuits.
- If your home is destroyed and you still have a mortgage on your house, you will still be required to make mortgage payments.
Home insurance can help pay for these losses. Contact Mitchell Insurance Services in Visalia, California, to learn more.
What Does Homeowners Insurance Cover?
Although every homeowners insurance policy is different, the following are some common types of home insurance coverage:
- Personal property coverage may help pay for damage to your belongings from covered perils.
- Dwelling coverage may help reimburse you for damage to structural aspects of your home due to a covered loss.
- Other structures coverage may help pay for damages to other structures on your property (e.g., detached garages, fences).
- Personal liability coverage may help cover costs (e.g., lost wages, medical bills, legal fees) if you’re accused of causing bodily injury or property damage to a third party.
- Additional living expenses may help pay for your extra living expenses if property damage renders your home temporarily uninhabitable.
When Should I Buy Homeowners Insurance?
Generally, it’s a good idea to begin shopping for homeowners insurance after you sign a contract for your new home. This should provide enough time to compare home insurance quotes before you close on your new property.
How Much Does Homeowners Insurance Cost?
Several factors affect the cost of your home insurance premiums. The following are some of the variables your insurer may consider when determining your rates:
- Home age and condition
- Credit history
- Your deductible
- Claims history
- Coverage limits and amounts
Where Can I Buy Homeowners Insurance?
We’re here to help. Contact Mitchell Insurance Services to learn more about our homeowners insurance coverage and to speak to an agent today.
This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.