If you plan on purchasing a home and applying for a mortgage loan, don’t forget to secure a Home Owner’s Insurance. Most mortgage lending companies require their borrowers to have a home owner’s insurance before granting approval on their loans. Most of all, a home owner’s insurance protects you from possible risks or unexpected calamities.

In any case, obtaining a home owner’s insurance should be every home owner’s concern. Your home is a most precious asset and spending a portion of your budget to insure it is certainly worth it. Here are some useful tips you must remember when applying for a home owner’s insurance:



Shop around for rates. You need to consider some choices before deciding on where to get your home owner’s insurance. To be able to compare rates, request for quotes from at least three different insurance companies. Remember that the insurance cost is not the purchase price of your home; it should be an amount sufficient to rebuild your home.

Choose a company with a strong financial foundation. Aside from a low premium, don’t forget to consider the company’s stability especially when it comes to its financial resources. See to it that the insurance company will be able to sustain the replacement cost of your home.

Ask for a replacement-cost endorsement policy. This means that the replacement cost on your home will be able to match the current rate in the market. Although, you will get an annual increase on your premium, it’s still worth paying for.

Make sure about the exact inclusions of your insurance coverage. Some companies do not include properties such as collections, jewelries or antiques in the coverage. While other companies often require an additional fee for these assets to be included.

Inquire about the deductible cost. Be aware that a homeowner’s insurance has a standard deductible cost of $250. Don’t settle for anything lower than that. If you do, your cost of premium would be much higher.
Know your liability limit. Most companies offer a $100,000 liability limit. However, if you can afford a higher limit, you’ll have a better coverage cost.

If you have a dog, know the insurance company’s policy regarding high-risk breeds. Yes, home insurance companies can deny your application if you own a particular breed of dog that is considered high-risk such as a Rottweilers, Doberman Pincers, German Shepherds and Pit Bulls.

Know the ways on how you can avail of a lower premium. If you already have a car insurance, perhaps you can inquire a home owner’s insurance from the same company. Since you’re an existing customer, you insurance company will more likely be willing to give you better rates. Installing a security system in your home can also enable you to avail of lower premiums from your home owner’s insurance company.

Examine your home owner’s insurance policy. To be sure, it would be better to ask assistance from a licensed home owner’s insurance agent who can personally inspect the validity of that particular policy.

About the Author
George Bents is a loan consultant with NewHorizon Finance and has been providing consumers and business owners with home loans financing since 1989. For years she has helped people with home loan problems especially pertaining to home mortgage loans and bad credit home loans. Copyright 2009

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