MAJOR Home Insurance Mistakes that Drain Your Money Fast!
You want to build your own house someday. The home symbolizes your financial stability and success in your life and career. That is why you dream of filling your house with state-of-the-art appliances like TV, Computers, beautiful couches, and air conditioners to provide convenience in the way you live. However, all of these properties and wealth accumulated can disappear in a snap if you’re not careful.
That’s why you try to protect your possessions from worst-case scenarios by availing a home insurance. But what if your home insurance drains your pocket to the point of bankruptcy? Well, maybe it’s time to stop committing the above-mentioned home insurance mistakes to avoid paying more than you have to.
Not Knowing the Different Types of Home Insurance
When you get a home insurance package, you might easily assume it covers everything in your home. It turns out, you’re wrong. You should realize that you can avail two types of home insurance. The most common home insurance is the Building Coverage. It pays you out when your roof blows away and you end up losing your house due to natural disasters. In case you have a home mortgage, most lenders require you a building insurance to protect your structure. However, it might be a different case regarding the contents of your home.
If you want your underwriter to compensate you for the lost possessions, then you should include getting a Content Cover insurance too. Content coverage replaces all the damaged possessions inside your house due to calamities.
Underestimating the Value Of your Possessions
If you decide to get a Content Cover Insurance, you need to enlist all your possession. It includes your most valuable items at risk from fire, flood, etc. You’re likely to declare a lower value or worth of your items to decrease your premiums. However, don’t do that. Why? It’s because your insurer might lessen your premium payouts if they discover you have underestimated the value of your possessions.
Dishonesty in Declaring Your Claims
The amount of your premium depends on several factors such as your location, previous claims, and home security measures. Some clients tend to not declare their previous claims, so they can file a new payout. You need to stop committing this mistake because it can damage your finances in the long run.
Most insurers now share their information, so they will know if you have failed to declare your previous claim. If this happens, they might entitle to drop your future claims altogether. Aside from that, you also need to provide an accurate data regarding your home security. Don’t declare that you have window locks when you don’t just to reduce your premium policy.
Not Keeping your Policy Up to Date
As your wealth continues to accumulate, the more items you acquire too. For example, if you’ve acquired a new fridge or MacBook, then list it down. Sure, you may have to pay an extra fee, but you’re paying to have a peace of mind. When in doubt, check with your agent whether you can enlist your new item or not. Some insurers can cover items in your shed or garage, while others don’t.
Expecting coverage for sewage backups and mold damage
Most home insurers won’t cover mold damages and sewage backups for standard claims. So don’t expect your insurer to include it in your payout. However, you can include those as additional coverage for your insurance, especially for old homes prone to high moisture levels. Moreover, adding sewage backups and mold damage in your insurance won’t cost you much.
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