There are lots of interesting and exciting things to think about when buying a new home in Connecticut. You’ll want to check out which community best suits your lifestyle. You’ll want to examine some floor plans to make sure the design of your house is right for your family. When it comes to new home insurance . . . that registers a little lower on the excitement scale.
That’s understandable, but home insurance isn’t something you should just ignore. It’s easy to overlook, because many homeowners simply have it wrapped into their monthly payments (it’s the second “I” in your “PITI” that determines how much you pay). Here are a few things you should check when signing up for new home insurance.
- Make Sure Your Coverage Is Adequate: While you don’t want to pay more than you should for insurance, you also don’t want to be underinsured. Ask your insurance agent to spell out exactly what is covered and what isn’t. If you should have to make a claim, that’s not the time you want to find out that your insurance doesn’t cover the problem you’re facing. There are a broad range of homeowner (HO) policies that provide different kinds of protection (HO-2 through HO-8). Work with your agent to get the one that’s right for you.
- Come to Terms with the Terms: You don’t need to be an insurance expert, but you’ll want to understand some basic terms and how they apply to your policy. Here are a few: Deductable (the amount you pay out of pocket before your insurance kicks in); Liability Coverage (covers medical or legal bills if someone is hurt on your property); Personal Property (the tangible contents of your home such as furniture, electronics, clothing); Premium (your monthly payment for insurance); Replacement cost (insurance that pays the full cost of replacing your dwelling or personal property); Riders (policies you can add to cover specific items such as antiques, jewelry, artwork).
- Compare Prices: In all likelihood, your mortgage lender will require you to have homeowners insurance. Sometimes you may be required to purchase additional insurance (such as flood insurance in certain areas). Get at least two or three quotes, but don’t necessarily go for the cheapest price. Check out customer reviews to see how the company does when you really need them (when you have a claim). It’s not worth saving a few dollars a month if you have trouble collecting.
>> Learn more about budgeting for your home here.
Lining up your home insurance may not be the most glamorous part of building your new Connecticut home, but it’s an important step you don’t want to ignore. Preparing yourself with a basic understanding of what you need (and what your options are) can help ensure that you get what you really need—without paying too much.