Buying a home comes with a long to-do list, and homeowners insurance is one of the items you will need to check off before closing. While it may not be the most exciting part of the process, it plays an important role in protecting your home and your finances.
If you are financing your home, your lender will require homeowners insurance before closing. This coverage protects the property if it is damaged by a covered event such as fire, hail, lightning, or a tornado. You will typically secure your policy shortly before closing, and your lender will need proof of coverage to finalize your loan.
What Does a Typical Policy Cover?
Most standard homeowners policies include:
Your Home
Coverage to repair or rebuild your home and possibly other structures on your property after a covered loss.
Your Belongings
Protection for personal items such as furniture, clothing, and electronics. High-value items like jewelry or art may require additional coverage.
Additional Living Expenses
If your home becomes unlivable due to a covered loss, this can help pay for temporary housing and related costs.
Liability Protection
If someone is injured on your property, liability coverage can help with medical bills, legal costs, and potential court judgments -- up to your policy limits.
What Is Not Typically Covered?
Most standard homeowners insurance policies do not cover damage from floods, earthquakes, or wildfires. These events typically require separate coverage. Depending on where you live, additional protection may be required or simply a wise way to protect your home and everything in it.
Water damage can also be confusing. If a pipe suddenly bursts inside your home, that is usually covered. However, water that enters from outside, such as rising floodwater, is generally not covered under a standard policy.
If you have questions about what your policy covers, reviewing your options can help you feel confident that your home is protected.
What Is Hazard Insurance?
Hazard insurance refers to the portion of your homeowners policy that covers damage to your home’s structure from covered risks such as fire, windstorm, hail, lightning, or vandalism. Mortgage lenders require this protection to help ensure the home can be repaired after a covered event.
When Should You Get It?
Start shopping for homeowners insurance once your offer on a home has been accepted. This gives you time to compare coverage options, review deductibles, explore bundling opportunities, and secure proof of insurance before closing.
A Member-First Approach
If you are buying a home or reviewing your current coverage, we are here to help you move forward with confidence. Connect with our Insurance agents for a personalized quote and coverage review.
