Two Essential Insurance Tips for New Homeowners

June marks National Homeownership Month, a time dedicated to celebrating the achievement of owning a home. For new homeowners, this represents not just the joy of having a place to call your own but also a significant financial and insurance responsibility. This post highlights three essential insurance tips to ensure your new investment is well-protected.

Understand Escrow and Insurance Premiums

For many homeowners, insurance premiums are paid through an escrow account managed by their lender. This setup simplifies payment, ensuring premiums are paid on time, while you focus on settling into your new home. However, it's essential to understand how your escrow account works. If you receive an insurance bill directly, your lender likely covers it, but always double-check to avoid lapses in coverage. If you have any questions about payments, a quick call to your lender can clarify things.

Consider Additional Coverage

Standard homeowners insurance policies can leave gaps in coverage. For instance, flood insurance is typically excluded and must be purchased separately, which is crucial if you live in a flood-prone area. Review your liability coverage and consider umbrella insurance to protect against larger claims that go beyond your standard policy limits. These additional policies ensure comprehensive protection for your home and personal peace of mind.

Understanding your insurance policy is critical in safeguarding your home and your financial future. As a new homeowner, staying informed and proactive about your insurance can prevent costly surprises down the road. For personalized policy advice, don't hesitate to reach out to an insurance professional or a financial expert.