As insurance brokers, we understand how complicated insurance can be for people who aren’t familiar with the business. Often, homeowners don’t know what to look for when shopping for their home insurance policy. So whether you’re a first-time homebuyer or an experienced one, here’s what you should consider for your home insurance policy.
1. Does the policy include a Guaranteed Replacement Cost?
Home insurance policies include a limit; that is, your home is insured for its value. But if your home is damaged and that damage exceeds the limit on your policy, a guaranteed replacement cost ensures that your insurance company is obligated to rebuild your property. So if the value of your home increases but your policy limit doesn’t, you’re still covered. Most insurers limit the amount up to 20% above your home insurance limit.
2. Look for an all-risk vs. named perils policy
Risks and perils in home insurance are anything that causes damage or loss to your home. When your insurance policy outlines the risks that are covered, this type of policy is referred to as a named perils policy. That is, anything that isn’t named isn’t covered. The most common named perils are theft and fire. All-risk policies, however, work on the assumption that everything is covered, including unexplained loss. However, there are always exclusions, so talk to your insurance provider to find out what might not be covered.
3. Is sewer backup coverage included?
Sewer backups can be caused by a number of factors, and cause huge amounts of damage to your home. But not all home insurance policies include sewer backup coverage. In fact, it’s common that it’s omitted or limited in most insurance policies. While you may have to pay extra to have this included, the fee is nominal at about $40-50 per year, and it’s worth it to avoid the potential disaster of having to pay for the damage yourself.
4. Are you doing everything you can to lower your premiums?
Did you know you can lower your insurance premiums? Because your insurance premium is based on risk, having a couple of safeguards in your home can help lower your rates. For example, installing a burglar alarm and smoke alarms lower your risk for home damage, thus lowering your insurance rates. Find out what other risks your home presents, and take steps to limit those risks.
5. Save money by bundling your insurance
Another easy and effective way to save money on your insurance costs is to bundle your home insurance policy with any other policies you might have. For example, consider getting your home insurance and car insurance through the same company. However, be aware of what you need and what you don’t need and stick to policies that work for you.
At Oakville Insurance Brokers, we offer a wide range of personal insurance options to fit your lifestyle. Learn more about how you can pick the home insurance policy that’s right for you! Contact us today.