Homeowners Insurance for First Time Home Buyers

New Canaan Connecticut couple sits amoung moving boxes after buying their first home and insurance.Being a first time home buyer is really exciting but can also be scary. Often the catalyst to purchase is connected to other major life decisions like getting married or having children. People are deciding that investing money into your own property, instead of spending it on rent, makes sense long term.

Understanding the ins and out of a home insurance policy (i.e. coverage and cost) when you are buying your first home becomes a huge priority. Whether you are buying a condo, brownstone or a house, you will want to find coverage that will adequately protect your investment as well as your personal belongings.

How Much Does Insurance for a First Time Home Buyer Cost?

There is no steadfast rule for how much home insurance will cost. Your cost will be dependent mostly on the size and location of your home and your insurance score.

Speaking to a local insurance agent like Daigle & Travers before you buy a home might alert you to potential problems or high costs. Risk management professionals who specialize in home policies see their share of claims and have access to the insurance company ratings in various areas.

 

What Can Make Your Home Insurance More Expensive?

  • If you made claims under a previous insurance policy like a renter’s policy, you would not be eligible for the claims free discount. Home insurance carriers look at claims in two ways. They will review previous claims that a home buyer has incurred over the last 3-5 years. They may also look at the property being purchased and the claims history of that location. When speaking with your insurance agent, ask for a “clue report” on the property that you are purchasing.
  • If you don’t take advantage of bundling your home and car policies, you may pay more for home insurance than someone who puts all their coverage with one company. You will want to evaluate the total cost of both policies with the same insurer. Sometimes if you look at the total costs, your car insurance cost might be more expensive with your home insurer, but the discount you will get on the home may make the total cost of your insurance less. Always evaluate your insurance as an entire package and not one on one.

 

Tips to Save Money on Your First Home Insurance Costs

Insurance carriers like to incentivize homeowners when they add security features to their homes that help mitigate against a claim. There are several ways that you can help protect against a claim that will lower your insurance premium:

  • Central station burglar and fire alarm
  • Central station low temperature/freeze alarm
  • Whole house generator
  • Central station monitored water shut off valve
  • Lightning rod
  • Perimeter gate

 

Don’t Leave Purchasing Insurance to the Last Minute

There is a lot more to home insurance coverage than just signing up for a policy. You might be surprised how many people get so carried away with the selection of their first home, getting pre-approved for a mortgage, the home inspection and negotiations, that they leave the insurance on their new home to the very last minute.

When purchasing a home, you rely on the professional team around you: your realtor, real estate attorney and mortgage broker.  These are the first team members you think about when deciding on a home. First time home buyers usually forget about the fourth, the independent insurance agent. Out of all of the experts that you work with, you will have the longest relationship with your insurance agent. We are the ones that will be here for you year after year as you move through life’s changes. For this reason, make sure that you are working with established professionals like the team at Daigle & Travers.

If you wait until the last minute for your home insurance, you may feel pressured to make a choice quickly, and not consider the implications of the coverages you get with your home policy. Do not put yourself in this position. Luckily when you work with our team, we act as a liaison to over 30 of the top insurance carriers in the country. We can take this pressure off of your plate. Based on the characteristics of your home, we will provide you with multiple qualified options that will protect you and your family in the chance of a claim. As we guide you through the buying process, we explain the rationale for purchasing a specific home insurance product.

When you get your quote for home insurance it will be based on building or dwelling value. Some new homeowners are surprised to find the real estate value of their home is not always the same as the dwelling value. This often causes unnecessary surprises, costs or issues.  Depending on where the region is on the real estate market, you may have to insure your home for more than you paid.

This is something you won’t hear from many insurance agents, “Don’t be cheap!” Commercials inundate the airwaves with savings gimmicks like ‘save 15% in 15 minutes’. Buyer beware – make sure that you are purchasing an insurance policy that will cover you when it matters. When you choose home insurance because it is cheap, you may not consider how you’ll be paid in a claim. You forget about the insurance once you have moved into your new home. When a claim happens that’s when people end up paying the most.

Do some research about the best home insurance and insurance agents in your area, and remember that insurance companies design their products based on who their target profile of client or risk is. The best car insurance company may not be the best company suited to insure your new home or lifestyle. You want to find one that offers you the most complete coverage for the things you need. There may a great home insurance carrier for a home inland, but they may not have the correct coverage or deductibles for a coastal or waterfront property. Daigle & Travers is a coastal insurance agency and we have specialty insurance markets for clients buying waterfront property. That being said, with our portfolio of markets, we can insure a home anywhere in the United States.

 

Do Not Assume the Cost of Your Insurance Will Be the Same as It Is For the Current Owner

Many people ask the previous homeowner how much the cost of home insurance, flood insurance, electricity, school taxes, property taxes and other expenses are when deciding on buying the home.

The answer to how much they paid in insurance is not a good indicator of how much you will pay. Insurance policies take into account very personal information in order to establish a cost. Another person’s age, credit rating, profession and what kind of insurance they chose will not represent your specific situation. Daigle & Travers recommends reaching out to an insurance professional early in the buying process. We can tell you if the home has previous insurance claims or if it sits in a flood zone. When making an offer on a property you want to have all of the ammunition to make the best decision.

There is a lot of information to think about when you’re a first time home buyer purchasing insurance. Allow an independent agent to help you with this process. We take pride in our work and will make sure that you have an enjoyable buying experience. In the unfortunate event that you have a claim, we will be your first point of contact. We are here to help you through the insurance claims process.

For more information reach out to Daigle & Travers Insurance. We have three convenient locations in Connecticut: Wilton, Darien, and Westport. One of our many experienced insurance professionals will be able to guide you through the insurance process. Call us at 203-655-6974. Or email us for more information at info@dt-ins.com.