What You Need to Know About Homeowners Insurance

It's not the most exciting topic, but its one which certainly warrants some consideration.  I'm talking about homeowners insurance.  It seems straight forward - just call your current insurance agent and add homeowners to your other current policies right?
Considering that your home will most likely be the largest purchase you make in your lifetime, maybe you should give this some thought.  In fact, frequently people will contact their insurance agent about a property BEFORE they make an official offer to purchase a property.  According to a recent article published by www.thesimpledollar.com, the factors which influence home insurance are:

HOME'S AGE & TYPE OF CONSTRUCTION: If your home is older, there's a higher chance there will be problems with major components like plumbing, electrical wiring, and HVAC systems.  New homes are less susceptible to these major problems.
LOCATION: If you live in an area prone to natural disasters, with a relatively high crime rate, or located far form emergency services, expect to pay more for your policy.
CLAIMS HISTORY:  If you file several claims a year, you are more likely to pay a higher premium.
RISK FACTORS:  If your home has a swimming pool, aggressive dog, trampoline, or other characteristic deemed risky, you'll likely pay a higher premium.
CREDIT SCORE: Your credit score (whether good, bad, or average) has an impact on the price of your policy.
DEDUCTIBLE:  The level of deductible you choose plays a role in the price of your coverage.  If you choose a high deductible, that means you have to pay more out of pocket if an incident does occur.  The trade-off is a lower premium.
COVERAGE AMOUNT:  The amount of coverage you select will play a role in the price of your insurance.
So what's wrong with simply calling your current agent and adding a homeowners policy without doing any homework?  Well, if you don't care too much about price, discounts, or ease of filing a claim then there's nothing wrong with it.  If you DO care about these things then a little homework will go a long way.  Our friends at The Simple Dollar have outlined how to choose the best homeowners insurance company along with lots of other great information regarding homeowners insurance.  Click HERE to read more.


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