Home insurance is required in order to buy a house. Just like you need car insurance before you can drive a car, you need home insurance before you can live in a house. While there are hundreds of companies and agencies that offer home insurance, knowing where to look can save you hundreds to thousands of dollars per year.
Why Do You Need Homeowners Insurance?
While it may seem like a burden, insurance is actually a good thing. Most people hate that they have to pay extra money each month on top of their mortgage. However, many people don’t realize how much of a benefit homeowners insurance really is!
Homeowners insurance is mandatory in most situations, and for good reason. The point of insurance is to protect you from major losses and catastrophes. While paying $50 or so per month might feel like a lot of money, it feels much more manageable when you submit a claim for $20,000 of damages caused by a hurricane!
Your house is usually the most valuable thing that you own. Naturally, you should want to protect it. A good homeowners insurance policy is the best way to make sure that your home is truly protected against accidents and incidents that can otherwise cost you thousands of dollars.
There is no state that legally mandates that you have homeowners insurance, but pretty much every mortgage lender requires it before they hand over the keys to your home. If you are able to buy your home in cash, you might be able to get away with not buying homeowners insurance, even if that is a bad idea. However, if you need a mortgage, you probably need homeowners insurance, too.
What Does Homeowners Insurance Cover?
Homeowners insurance typically covers accidental damages to your home. This can be from weather, vandalism, accidents, and more. A typical homeowners insurance policy covers damages from theft or vandalism, fire and smoke, theft or vandalism, extreme weather events (like lightning, blizzards, wind and hail), and incidental damages like cars or trees crashing into your home.
Your homeowners insurance covers most of the important parts of your home. Generally, you can expect your policy to cover your heating and cooling systems, kitchen and laundry room appliances, furniture, and clothing and other possessions. Other structures on your property, like sheds, decks, fences, and grills is also usually included. This does vary by policy, though, and is something that you should double-check on your policy documents or insurance quote.
How Much Does Homeowners Insurance Cost?
Homeowners Insurance costs vary greatly based on many factors. The age and size of your home, its value, its geographic location, and its construction materials all factor largely into your insurance price. Insurance prices are called premiums, and the average homeowners insurance premium in the United States is somewhere between $1,000 and $2,000 per year.
Naturally, if you have a more expensive home, live in a state that is more prone to natural disasters, or own a home that is a hundred years old, your insurance will likely cost more. New homes tend to cost less to insure, as there is less of a chance that they will need major repairs or have major accidents.
Which Company Is Best for Homeowners Insurance?
There are hundreds of insurance companies and insurance agencies that sell homeowners insurance, and it is natural to wonder which one is the best. While you might hear great stories from friend and family about one company or another, the truth is that most insurance companies are actually the same.
Insurance is a pretty standard product, much like orange juice. It is hard for one insurance company to be better than another. In reality, you should just choose the company that offers you the cheapest price, as long as the coverage options are all the same.
For example, you may get a quote from one company that offer $300,000 of coverage and a quote from another company that only offers $200,000 of coverage. If your house is worth $300,000, you obviously don’t want to pick the quote that underinsures your house!
However, if both quotes offer identical coverages, and one is cheaper than the other, it is almost always a good idea to go with the cheaper quote – even if you don’t recognize the company’s name.
How Long Does Homeowners Insurance Last?
Homeowners insurance policies almost always last one year. The regulations may vary by state, but the vast majority of home insurance policies are for 12 months.
This is different from car insurance, which generally lasts 6 months. Still, it is almost always a good idea to get your car insurance and homeowners insurance through the same company, as bundling home and auto policies tends to save hundreds of dollars per year!
Can You Wait Until After Closing to Get Homeowners Insurance?
If you are getting a mortgage, you almost always need homeowners insurance before closing. Almost every mortgage lender requires a homeowners insurance policy document before they will hand over the keys to your home. If you don’t have proof of homeowners insurance, they likely will not fund the purchase of your home. Typically, your loan advisor will let you know when you should start shopping for homeowners insurance.
Thanks for reading our post all about homeowners insurance. While homeowners insurance costs some extra cash each month, it has the potential to protect you from hundreds of thousands of dollars of losses. If you don’t have homeowners insurance and your house burns down, you literally lose everything. If you have homeowners insurance, you are usually protected from extreme losses like this. $50-100 per month might seem steep, but it feels like nothing once you file your first claim.
If you visit Myrtle Beach or any other place in South Carolina and fall in love, we’re here to help. We at The Boyd Team are committed to helping you find the right property for your needs and dreams. Any question that you have about moving to the area and finding your dream home by the beach is our pleasure to answer. Feel free to send us an email at firstname.lastname@example.org or text or call us at (843) 222-8566, and we will get back to you as soon as we can. Being true natives of the Grand Strand and Horry County and with over 25 years of experience in the local real estate market, whether buying or selling, we can help you make your dreams a reality.
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