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Owning your own home can be a gratifying experience, but there are a lot of financial costs that come with this investment. In addition to the down payment you need to secure the home, your monthly mortgage payment, and ongoing maintenance costs, you also need to purchase homeowner’s insurance for the instance that something goes wrong and you need money to repair or restore something in your home.

 

Let’s take a look at five facts you may have never known when it comes to home security as well as homeowners insurance:

1.    Credit History

Your credit history and credit score were likely significant when you were securing your mortgage rate, but this will also affect your homeowner’s insurance policy as well. A poor credit score doesn’t reflect well on your ability to pay for your insurance and brokers don’t want to provide you coverage if they don’t feel they can rely on you.

 

2.    Using Your Policy Increases Your Rate

This is one of those products that you have to buy, but you don’t want to have to use it. The more years that go by without having to tap into your coverage, the lower your rate will be. If you utilize your insurance a few times within the first few years of owning your home, your rate will likely increase by quite a bit.

 

3.    Your Pets Affect Your Policy

When you purchase homeowner’s insurance, you are also insuring other parts of your home like your pets. In the instance that your pet was to bite or attack someone on your property, your insurance would be responsible for this. If you have a dog breed that is considered to be a ‘bully’ breed (pitbull, boxer, etc.), then this will make your policy go up. Something like one indoor cat won’t make much of a difference though you do have to claim all pets.

 

4.    Home Security Affects Your Rate

The overall level of security of your home affects your policy coverage and your price. If you invest in things like a home security system, it appears that your home will be safer and you are less likely to need your coverage. According to ADT, “there were over 1 million home burglaries in 2015. That’s a rate of one burglary for every 134 homes making home security more important than ever.” if you live in a high-risk location or somewhere that crime is more prevalent, it could affect your homeowner's insurance.

 

5.    Everything In Your Home Is Not Covered

Don’t assume that just because you have homeowner’s insurance, you have everything under your roof covered. In most cases, your policy contains an in-depth inclusion/exclusion breakdown. However inexperienced agents fail to really make sure their clients understand the exclusions that bring the premium cost down. Utilizing policies like flood coverage or extra valuables, can increase your premium but lower your risk in case of theft or disaster. Then you have other cases that may be considered neglect on your part and they would not be covered. For example, if you find that you have damage to your home from a leaky faucet that had been leaking to your knowledge for some months, this isn’t likely to be covered. 


Before signing up with a homeowner’s insurance company, do your research and make sure that you know all about the coverage you are considering. While it might seem like a burden to purchase homeowner’s insurance,it is very beneficial to understand the kinds of coverages that are relevant to you.

 

Please call us at 888.279.9701 if you are in need of an experienced homeowners insurance broker who can walk you through the process.


Posted 10:28 AM

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Alliance Insurance Group
7910 Ralston Rd., Ste 7
Arvada, CO 80002

Phone: (303) 279-9700
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