Aug
2012
Home Insurance is the type of property insurance that covers private homes, and is essentially a policy that provides personal protection for the home owner. Depending on the type of policy and the company providing it, insurance may include cover for losses and damages to one’s home or its contents, and accidents that may occur at the hands of the owner or another party.
When you buy a home that will be financed through a bank they will require comprehensive insurance to be taken out in the event that a catastrophe requires that the structure needs to be rebuilt.
In real terms, a comprehensive policy should cover events such as burst geysers, damage to permanent fixtures, faults in the electrical or plumbing systems. Generally policies will cover damage and loss of buildings and/or the contents. It is, however, paramount that you read the small print and understand exactly what is included and excluded in your specific policy. Most often excluded from insurance policies is destruction caused by pests – as the insurance company considers pest control to be the homeowner’s responsibility – as well as flood and wind damage. Some policies may even cover the cost of alternative housing should your home be damaged to the extent that it is uninhabitable.
Like with most important decisions, it is best to take your time, do your research and shop around for the best deals. It is vital that you decide exactly what you want from your home insurance in order to be certain to find the right policy.
Initially it is wise to get a wide variety of quotes from as many insurance companies as you can, and source recommendations from people you trust.
Once you have sourced enough quotes it is time to go about finding out if you can reduce your monthly premiums at all. Most companies will accept a lower premium if you purchase a new home, since the likelihood of electrical or structural faults is much lower. You can also consider whether you would be able to afford to raise the deductible amount should you need to claim anything against the policy since this also reduces the monthly premium payable.
Another great way to get the best available policy for home insurance is to combine it with your car insurance as most companies will offer a significantly discounted premium for the joined policies.
Most insurance companies will also base monthly premium payments on the security that is in place to protect the house and its contents as well as any measures taken that will reduce the risk of fire in the home.
Once you have found the most suitable policy for your needs and satisfied yourself that the terms and conditions are sensible, make sure to review the policy annually to affect any changes necessary. Details do make a difference, since home improvements done to the home may increase the value, but the sale of a costly item may require less coverage overall.
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