Homeowners insurance is a form of property insurance, which almost works similar to ordinary property insurance. In this insurance it covers damages and losses of the individual house and the assets. Well, this sort of insurance covers four types of incidents which are loss or damage of personal assets, interior damage, exterior damage and injury that arises on the property. The loss or damage caused by an act of God or act of war cannot be recovered as these are excluded from the policy. In this type of insurance, the owner has a right to make his own insurance policy and declares the amount of liability, unlike other insurances where the owner did not have a right to make his own policy. You can pay a certain limit, if your losses are beyond the insurance policy.
Difference between Homeowners insurance and home warranty
Homeowners insurance is different from home warranty. The home warranty is the warranty of different appliances of the home, which includes oven, repairs, and replacement of water heaters, pools and washers/dryers. The contract of home warranty lasts from 12 months. On the other hand, the homeowners insurance does not cover the wear and tear of these appliances not replace these products because of poor maintenance.
Difference between Homeowners insurance and mortgage insurance
Homeowner insures as the name suggest, it is for the homeowner while mortgage insurance is for the lenders. In mortgage insurance the buyer has to pay a specific percentage of the cost price of a house say 20%. It covers the lender for issuing a loan to a home buyer.
Important Elements when buying Homeowners insurance
We are going to discuss some elements for buying homeowners insurance
- Comparison of companies
- Escrow your payments
- Insurance according to your budget
- Include Medical term
- Addition of assets
- Amount of loan
Comparison of companies
There are many insurance companies of the world provides Homeowners insurance to the homeowners of a specific property. You must have to choose a specific company who has more customer reviews. You have a duty to check the coverage area under insurance, terms and methods of payment as well as the price of the insurance. However, you can check the stats of minimum three insurance companies which will helpful for you in deciding which one is good for you.
Escrow your payments
It is the safest way to transfer your payment to the insurance company. You must have to escrow your payments as it surety that your payment will deliver on safe hand. Don’t trust anyone for pay insurance premium.
Insurance according to your budget
Every insurance company works in different type of insurance like car insurance, life insurance, flood insurance etc. You may only select those insurances which you want to take from these companies. More than 1 different types of insurance will increase your budget.
Include Medical term
The insurance company may give you medical facility as a clause in Homeowners insurance. This facility may be free of cost or some nominal charges.
Addition of assets
In Homeowners insurance, you must also choose which sort of assets have to be included or excluded in the clause.
Amount of loan
You can take a loan from your insurance company. It had already mentioned that how much amount you can withdraw against your policy.