Buying homeowners insurance is a good thing. It protects one of your most important investments. But many homeowners make mistakes that can be avoided. Taking time to consider your options can save you money and future headaches. We found at least four mistakes people sometimes make when purchasing homeowners insurance.

Not Having The Right Value For Your Personal Property.

Most people under value their personal belongings. We recommend you complete a home inventory to make sure you have the correct value on all your property. Remember, the insurance covers what it costs to replace the item, not what you paid for it.

Not knowing the replacement value of your home.

Many people don’t understand the difference between “market value” and “replacement value.” Market value refers to the value of your home for resale purposes.  Replacement value refers to the cost to rebuild your home from the foundation up.  Ask your agent to help you define what it might cost to rebuild your home using current new construction costs.

Improper Value On Jewelry And Other High-Value Items

Most homeowner’s insurance policies have limitations on jewelry, guns, and other collectibles. Make sure you identify these if they are over $1,500 (this varies, so call us for a review).

Not Fully Understanding Your Policy Exclusions

Every homeowner’s policy has exclusions. Flood and earthquake are not included in a standard homeowner’s policy. Wear and tear is also excluded.

Not Considering Special Insurance Like Flood Or Earthquake

Even if you are in a low-risk area, it only takes one event to create a total loss. It pays to get a quote at least and review the pros and cons with our team.

Using The Wrong Deductible

Increasing your deductible will lower your homeowner’s insurance premium; however, make sure you have the resources to pay the deductible in the event of a loss. If you increase your deductible to $2,500, do you have the $2,500 to pay the deductible? We can help you understand how deductibles work and set the right one for your individual situation.

As insurance professionals, we will guide you through the purchasing process and keep you informed of how these issues will impact your personal insurance program.