Published February 02, 2017
Homeowners insurance is a necessity. If you have a mortgage, your lender will require coverage -- and if your home is mortgage-free, then you should have coverage anyway.
But not all insurance coverage is alike. Policies and protections differ, and so do costs. Your goal is to find the right amount of protection for the least amount of money.
3 types of homeowners insurance
Homeowners insurance generally comes in three standardized packages:
Determine which policy will work best for you
To determine which policy is best for you, make a list of valued possessions and the types of coverage you'd generally like to have. Then, sit down with an insurance broker to review what's included (and excluded) from each policy form and the other forms of coverage that may be available. You may find all the coverage you want in a general form, or you may determine you need special coverage at extra cost.
Ask the right questions
To get the most from your policy, it helps to create a list of questions to ask your insurance broker beforehand. Some examples:
Find the best price
Finding the best price on homeowners insurance can be tricky. You don't want to simply sign up for whatever policy is the cheapest and end up underinsured, but you also don't want to pay more than you have to.
To make sure you're getting the best deal, ask your insurance broker for a list of comparable plans from about three other providers. The price for similar coverage can vary from provider to provider. Finally, don't forget to factor in your own circumstances. The location of your home, the size of your home, and even your credit score can affect your insurance costs.
Updated from an earlier version by Peter. G Miller
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