Whether you are buying or renting a property, you might be looking into insurance options that will keep your new home protected. This new chapter in your life could also come with new concerns and worries, prompting you to seek personal coverage as well. But with such an overwhelming amount of different insurance options currently available on the market, it can often be difficult to discern which types of policies are truly necessary, and which ones and superfluous for your needs.
To help you make a better, more informed decision, here are some of the most common ways you can protect both your home and yourself with insurance:
Homeowners insurance
Generally speaking, homeowners insurance is purchased before finally closing on a home, thus protecting your new investment from potential disaster. In most instances, homeowners insurance covers a home against theft and damage, as well as other aspects such as injuries sustained on the property. This type of insurance will also cover the roof, foundation, and walls of your home, including your personal items, but you might need additional insurance for protection against natural disasters.
As different policies will offer different levels of protection, it’s important to do thorough research before buying homeowners insurance. Most financial institutions won’t approve home credit loans and mortgages without the home being previously insured, and might even require additional coverage along with a basic homeowners insurance policy. For this reason, it’s advised to ensure the policy you choose meets the lender’s requirements, as well as your own, before purchasing a new home.
Flood and earthquake coverage
As already mentioned, basic homeowners insurance has its limitations and typically doesn’t cover damage sustained due to natural disasters, which you might need depending on your geographical location. For instance, if earthquakes are a relatively common occurrence where you live, this is a type of supplemental insurance that generally isn’t included in basic homeowners policies you might want to consider, as earthquakes can be quite damaging to the structural integrity of your property.
While most homeowners policies might cover flooding due to burst pipes and other similar water leaks, they often won’t protect against flooding caused by natural disasters. In case your home is built on a floodplain, or is located in an area that’s commonly flooded such as near a river or ocean, you might benefit from this type of insurance as well.
Mortgage protection insurance
A type of add-on insurance often sold along with home loans, mortgage protection insurance generally covers involuntary unemployment, accident and illness, disability, and/or life. As it falls into the category of consumer credit insurance, mortgage protection is often considered to be “junk insurance” that is too expensive and offers no real value to consumers, as well as being sold using questionable sales practices in most cases.
To that end, it’s recommended to check your contracts and statements to see whether you have been sold junk insurance. In case you have been paying for such insurance unwittingly, it might be best to contact junk insurance experts who will help you to establish a claim. If you’re eligible for a refund, such experts who specialize in junk insurance claims will be able to acquire necessary documents, request a refund, and get you your money back, all without charging you in case the claim doesn’t end up being successful.
Renters insurance
On the other hand, if you’ve decided to rent a home instead of purchasing one, and you don’t need to file a claim in insurance, you might want to consider renters insurance. Regardless of the type of home you are renting, this insurance offers protection against the loss and damage of personal belongings, such as furniture, clothing, electronics, and appliances, and might even cover temporary relocation in case a rental unit becomes unexpectedly uninhabitable due to covered events.
However, renters insurance generally doesn’t cover existing fixtures in the rental unit like built-in appliances, as well as extremely valuable items, damage caused by natural disasters, and damage caused by pests. Many landlords will require renters insurance from their tenants as a prerequisite to renting, thus making it a necessity in certain cases.
Health insurance options
The home isn’t the only thing that requires protection. The COVID pandemic has impacted the insurance market in quite significant ways, forcing a higher percentage of individuals to opt for more comprehensive health insurance policies. In countries like the US, where healthcare is privatized, the effects of the pandemic in combination with rising co-payments and deductibles are thought to have put many families in dangerous positions, being one serious illness away from bankruptcy.
In these instances, participating in an employer’s insurance program is the wisest option for many individuals, or alternatively seeking group health coverage through trade organizations or associations. If neither of these options is viable, then it’s recommended to buy private health insurance. As healthcare is quite difficult and complicated insurance, the type of plan, the amount of coverage, and the overall cost is generally chosen according to an individual’s specific needs and requirements.
Life insurance policies
Another common insurance individuals also buy for personal protection is life insurance, citing benefits such as having the ability to cover funeral costs and providing for those they love after they are gone, which can be particularly important for those who currently have family members that are dependent on their salaries. For this reason, most consumers don’t only factor in funeral expenses, but also living expenses such as loans, debts, and mortgage payments when purchasing life insurance policies.
It’s important to note that there are two main types of basic life insurance, traditional whole life insurance that covers you throughout your entire life until death, and term life insurance that only covers you for a certain period of time. Apart from your occupation, age, and the number of dependent family members, there are a number of other aspects to consider before choosing the most appropriate life insurance policy, which is why it’s often recommended to consult a financial expert.
When life happens, it truly pays to be covered. To that end, it’s important to do your research, and choose the best insurance policies that will help to keep you and your home safe and protected.
