The Basics of Homeowners Insurance

 Homeowners insurance protects you from damage to your home due to destructive events like a fire or theft. This type of insurance also covers medical bills and legal fees in case other people who don’t reside at your property get injured.

 

Homeowners insurance is not required by law, but lenders require it as a condition of getting approved for a mortgage. Continue reading to learn the basics of homeowners insurance and everything you need to know about taking out a homeowners insurance policy.

 

Homeowners insurance typically covers the following type of incidents:

 

Exterior damage. Any damage to the exterior of your home is typically covered by homeowners insurance. This may include damage to windows and siding or landscaping and detached garages.

Interior damage. Interior damage is any damage from destructive events that had an impact on the interior features of your home. This may include plumbing issues and damage to appliances.

Loss of personal assets. Personal assets like clothes, jewelry, or collectibles may be covered by your homeowners insurance. You should know exactly what is and isn’t covered before you choose a policy.

Injuries. Any injuries sustained while on the property are typically covered by homeowners insurance. Injuries may be sustained from events like a fire or other natural disasters.

 

How much is homeowners insurance?

 

The cost of homeowners insurance varies depending on the following factors:

 

State and city. Some locations require homeowners insurance that’s more expensive. Cities with a higher cost of living and home prices typically have homeowners insurance policies with higher premiums.

Materials to build the home. Certain materials withstand damage better than others, which can help to lower your monthly premiums. Expensive materials may lead to higher homeowners insurance premiums.

Credit score. Insurance companies may take your credit score into account to determine your premiums.

Age of the home. Older homes are more susceptible to damage from events like weather issues and plumbing problems. Additionally, older building materials may not comply with new building standards.

Coverage options. The more coverage you have with your policy usually means higher premiums.

 

While these factors influence the price of homeowners insurance, the average cost of a policy is about $1,380 per year with $250,000 in coverage. However, most homeowners insurance payments are included in the monthly mortgage payment of the borrower and aren’t paid out of pocket once per year.

 

Another factor that determines the cost of homeowners insurance is the company you choose. All insurance companies are different, so you should obtain quotes from several companies when looking for a homeowners insurance policy.

 

Homeowners' insurance and mortgages

 

While homeowners insurance isn’t required by law, lenders require homeowners to show proof of insurance before they decide to approve them for a mortgage. The bank may also obtain a homeowners insurance policy for borrowers that don’t have their property covered currently.

 

Final Thoughts

 

Homeowners insurance is essential to protect yourself and others from harmful events that result in financial loss. Contact us today to work with a real estate agent to sell your house in Massapequa to start reaching your real estate goals!