Updated July 8, 2021
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The time it takes to get homeowners insurance can vary from a few minutes to a few days, depending on the insurer, the age of your home, and whether it's a new home.
When you get a homeowners insurance quote, the insurance company will ask you several questions about yourself and your home to help determine insurance rates. You may get a quote online, in an insurance agent ‘s office, or over the telephone. After getting a quote, it could take a couple of days to finalize the purchase, depending on whether the insurance company wants to do a home inspection.
Are you buying your first home? If you need help shopping for home insurance, Insurify’s homeowner insurance comparison tools help you get quotes for comparison shopping from top insurance companies to find the best rates and coverage options. It’s so quick and easy!
If you own your home outright, you don’t have to purchase homeowners insurance. However, just because you don’t legally need to carry homeowners coverage doesn’t mean you shouldn’t. There are so many ways you can suffer expensive damage to your home, and you don’t want to have to come up with the kind of money needed to make costly repairs after a fire or other type of natural disaster or loss. It would be best to choose the right coverage limits to ensure you have enough protection on your home and its contents.
If you are purchasing with a home loan, mortgage lenders will require you to have homeowners insurance to protect their interests. You need the money paid to you in an insurance claim to repair or rebuild your home after you’ve suffered a loss. You may hear a lender use the term “hazard insurance,” but don’t let that confuse you. Hazard insurance is just a term that refers to the portion of a homeowners policy that covers the structure of the home. Homeowners insurance covers the structure and your contents up to a certain amount, unlike renters insurance, which only covers your contents.
There are many different types of coverage included in a homeowners policy, and you can add some policy endorsements to give you more coverage.
If you choose replacement cost coverage, the policy covers rebuilding your home to today’s standards. With actual cash value coverage, home insurance companies will only pay the policyholder the actual cash value of the home, which is the replacement cost minus depreciation. For older homes, the additional cost of replacement cost coverage might not make sense, and actual cash value would be sufficient.
You will also have personal liability coverage that protects you if someone is injured or their property is damaged at your home. If your dog bites your neighbor and destroys his new suit, the liability portion of your homeowners insurance can pay for the costs.
Medical payments to others coverage (also known as Coverage F of your homeowners insurance policy ) will pay for medical expenses if someone at your home is injured, regardless of fault. Most insurance carriers have $1,000 to $5,000 policy limits for medical payments during the policy term.
Home insurance policies pay for additional living expenses (also known as loss of use coverage) if you must temporarily relocate while repairs are being made to your home after a covered loss. Additional living expenses coverage can help pay for essentials like hotel stays, food, storage fees, etc.
If you are closing on a home, you will need to purchase homeowners insurance before closing or set up an escrow account to pay the insurance when it comes due. Make sure you check with your lender before closing because depending on the area where you live, you may be required to carry extra coverage in addition to personal property coverage, such as flood or earthquake insurance.
To get your homeowners insurance quote, you’ll need to have some information on hand that the insurance company is likely to ask for to complete the underwriting process. Here is a helpful list of things to have.
Details about your home (roofing construction material, HVAC type, other home systems, square footage, safety features)
The declarations page of your current homeowners policy if you have one
A copy of your mortgage contract
Your personal information (name, date of birth, telephone number, email address, etc.)
The residence address and the number of people living in your home full-time
How the home is used (primary residence, vacation property, business, daycare, etc.)
Additional coverages that may be needed, such as flood insurance, windstorm coverage, or earthquake insurance
A complete home inventory so you can schedule any expensive personal belongings on your policy
When you purchase your policy, you'll choose a date for your homeowners insurance coverage to go into effect. The date coverage goes into effect is called the policy inception date, when your coverage starts. Your lender has to give its stamp of approval to your policy before it can go into effect.
Most lenders will ask for you to pay one full year's premiums before you move into your home. In this case, you would need to purchase a policy before closing. If you have an escrow account, funds will be allocated during the closing to take care of the cost of your homeowners insurance.
The escrow fund pays your home insurance premiums and property taxes each month as they come due. When you make your home payment each month, part of the payment is held in the escrow fund to pay insurance and taxes. The advantage of the escrow fund is that you don't have to remember to pay your home insurance and property taxes. FHA loans are required to have an escrow fund, but conventional loans may or may not have an escrow requirement. Ask your lender any specific escrow questions you may have before closing.
Several factors determine the price of property insurance, including the home's age, the amount of coverage you need, your claims history, and the area in which you live. There are several ways you can save money on your homeowners insurance costs. One of the easiest ways is by bundling your home and auto insurance to qualify for a multi-policy discount. You can also choose a larger deductible, which will make the premium less expensive. Home security and home protection devices like a sprinkler system or a deadbolt can also qualify you for a hefty discount, up to 10 percent with some insurance companies.
Buying a home is one of the most significant decisions you’ll ever make, and protecting your investment with homeowners insurance is vital. If you are a first-time homebuyer, spend a little time and research now to compare homeowners insurance rates. Finding the right homeowners protection is an essential step in securing your family’s future.
Janet Hunt received her B.S. in Business Administration with the University of Phoenix. She has worked in the insurance industry for over 20 years. Janet likes to spend her spare time coming up with gourmet recipes and trying them out on her guests. So far, all have survived.Learn More