Is your home properly protected?by Tim Manni
So, you’re getting ready to purchase a home…You’ve got your credit up to snuff, you’ve asked yourself, “How much house can I afford?” and you’re shopping around for the lowest mortgage rates…Seems as though you’ve got all your bases covered so far. But wait, have you given strong consideration to how you will protect what is likely to be the biggest purchase of your life?
As Barb Marquand writes in her latest contribution to HSH.com, while home insurance may not be at the forefront of your mind when you’re buying a home, it certainly deserves your utmost attention:
“It’s important for new homebuyers to think of insurance as part of the home search process and to look at obtaining coverage for the home as far in advance of closing as possible,” says Mary Bonelli, a spokeswoman for the Ohio Insurance Institute.
The first thing you should know about home insurance is how to get a CLUE:
Besides getting a home inspection, request a copy of a C.L.U.E. report. C.L.U.E.–Comprehensive Loss Underwriting Exchange–is a database owned by LexisNexis Risk Solutions that gives insurers access to information on claims that have been filed against the property in the last five years. As a prospective buyer, you can’t get a report from the company, but you can ask the homeowner, who can ask LexisNexis, for a copy, Bonelli says.
According to LexisNexis, a growing number of buyers are requiring sellers to provide a copy of the report as a contingency for a purchase offer. The loss history will reveal problems that could make insuring the home difficult or expensive. Ask an insurance agent about the home’s insurability and for an estimate of the premium.
Marquand’s article, “7 basic facts about home insurance,” will not only tell you what certain home insurance policies cover and what they don’t cover, she also addresses the limits of certain coverage and what to do with your policy if your home has lost value.
“When in doubt about your home insurance coverage,” writes Marquand, “check your policy and talk to your agent. It’s better to address questions now than to get caught short after the damage has been done.”
Be sure to read “7 basic facts about home insurance” in its entirety.