Being a first-time home buyer can be a daunting process. Besides considering home inspections, closing dates and mortgage costs, you also need to educate yourself on homeowners insurance. The following are a few frequently asked questions from first-time home buyers to help you learn about the importance of homeowners insurance.
What is homeowners insurance?
Homeowners insurance helps provide coverage for a private home and compensates homeowners in case of a covered loss. The amount of compensation received in a claim depends on the limits set in the policy.
What does homeowners insurance cover?
Homeowners insurance policies provide coverage for a range of risks homeowners may face, such as the following:
- Property damage to the dwelling and other structures
- Personal property loss
- Personal liability
- Additional living costs
Is homeowners insurance required?
Homeowners insurance isn’t required by law, but your mortgage lender will likely require coverage before you get a home loan.
Why is homeowners insurance important?
Homeowners insurance is essential for three main reasons:
- If you’re insured, the repairs or rebuilding of your home after a disaster may be fully or partially covered.
- If you have adequate homeowners insurance and your home is destroyed, it may help pay for rebuilding or replacement costs.
- If you have liability coverage, it may be able to cover the medical costs or legal fees if something happens to a guest on your property, and you are responsible for their bodily injury or property damage.
When should I get homeowners insurance?
A mortgage lender will most likely require proof of homeowners insurance before you can close on your home. As soon as you sign a contract to buy a home, you should start shopping around for a homeowners insurance policy.
How much does homeowners insurance cost?
Homeowners insurance costs vary greatly depending on several factors, including the following:
- Where you live
- The price of your home and the cost to rebuild it
- The amount of coverage you need
- Your home’s age and condition
- Home security and safety features
- Your credit history
- Your deductible
Where can I get homeowners insurance?
If you are interested in learning more about homeowners insurance or are ready for a quote, contact Saratoga Insurance Brokers. We work with customers throughout the United States, including our home state of Maryland and the surrounding states of Pennsylvania, Virginia, Delaware and Washington, D.C.
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.