5 Things To Consider When Buying Homeowner’s Insurance


There are many things to consider when purchasing a new home. Oftentimes, people don’t consider or are simply unaware of the extra fees when the sale closes, with the monthly or annual payments that need to be made on top of the mortgage, including homeowner’s insurance.

While you’ve probably been excitedly planning your move, perhaps looking at new furniture, you’ll want to take the time to shop around for homeowner’s insurance too in order to ensure you get the best value.

Here’s what you should consider during the process.

Determine Your Budget

If you are selling your home and purchasing a new home, you must factor in all costs, not just your mortgage. Determine your closing costs for both the sale and purchase, which need to be paid when the sales close. Use a seller closing costs calculator so you are prepared for the fees that you will need to pay. You’ll also be responsible for property taxes, HOA fees if applicable, and homeowner’s insurance, which means by obtaining some quotes, you’ll have a good idea of how much to budget for that part of the equation.

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Getting Adequate Coverage

You don’t want to purchase too much and end up paying more than you need to or get too little coverage either. If you are in an area prone to a specific natural disaster, make sure your policy covers it or purchase an additional policy. For example, in California, more than 70% of residents live within 30 miles of a fault and those homeowners must purchase earthquake insurance separately since it is usually not covered by a homeowner’s policy.

Look for Discounts

The easiest discount to get comes with carrying multiple insurance policies from the same company. The first company you should get a quote from is the same one you have your automobile policy with. Nine times out of ten, your insurance carrier will offer you a multi-policy discount. This company should also be aware of any other discounts you may qualify for, such as senior or veteran rates. Always ask what other discounts are available, even if you may not qualify for them, as you just may be surprised at what deals you can get.

Shop Around

Although it’s a no-brainer to consider your auto policy carrier first, you’ll still want to do some shopping around. Get at least a few other quotes from reliable companies. To confirm that they’re reputable and in good standing, you can check AMBest. Ask about adding your auto policy too so that you still get that multi-policy discount.


A deductible is the amount you must pay before the insurance company will start to help. A standard deductible is $500, but if you can afford a higher deductible, perhaps $1,000, it will lower your annual premiums considerably. However, if you do not have an adequate emergency fund, the extra expense when you need to use your policy may place a burden on your family. Consider what makes the most sense for you.

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