If you are planning to purchase a home, there are many expenses you will need to be prepared to undertake. One expense that many buyers fail to consider is that of homeowner insurance. Clearly, purchasing homeowner insurance is a wise choice, as purchasing a home is probably the biggest purchase you will make in your lifetime. Furthermore, if you are financing the purchase of your home, the mortgage lender will require you to obtain homeowner insurance as part of the loan agreement. Before you purchase a homeowner insurance policy, however, there are several things you will need to keep in mind in order to ensure you obtain the type of coverage you need.

The first thing you will need to consider is what is covered by the homeowner insurance policy. With a basic homeowner insurance policy, your home and its contents will be protected from damage caused by hail storms, wind, lightning and fire. In addition, a basic policy will include coverage for the motel and food costs you incur if you are forced to leave your home due to damage. On the other hand, a typical policy will not provide coverage for earthquake or flood damage. Therefore, if your home is located in an area where this is a risk, you will need to purchase a separate policy in order to provide you with the extra coverage you need.

In addition to providing coverage for damage caused by natural disasters, homeowner insurance also provides coverage for things such as theft and vandalism. Furthermore, your policy will provide you with protection against things that are not related to property damage, such as liability coverage for lawsuits that may be brought against you by people who are injured on your property. This part of the coverage will help cover the cost of legal defense as well as the cost of basic medical expenses for the injured party.

While there are many basics that are included in the standard homeowner insurance policy, the amount of the coverage provided will vary from one policy to the next. Therefore, you need to consider the size and type of home you are purchasing as well as the value of the property within when trying to determine the amount of coverage you need. Clearly, the mortgage loan company will require you to have enough coverage in place to cover the value of your loan, but you will likely want to have additional coverage and protection in place in order to give you the peace of mind you need. Therefore, you should discuss your options with an insurance agent while making certain to closely compare policies before you make a purchase.

Author Bio: Jim Olenbush works with Real Estate in Austin, TX. His team sells West Austin property, and they are also very experienced with Lake Tadalis SX Travis waterfront property. Jim and his team would love to answer any questions you may have about Austin.

Category: Finance/Insurance
Keywords: homeowner, insurance policy, homeowner’s insurance, coverage