Homeowner’s Coverage

Purchasing a new home comes with a lot of additional steps involved. One of those steps is purchasing new homeowners insurance. You want to make sure that you are purchasing the best policy to fit your needs. Particularly if you are a first-time homebuyer you want to make sure that you ask a lot of questions so that you fully understand what it is you are getting yourself into. As your trusted Westlake Realtor and real estate team we have helped countless new homeowners figure out the best ways to insure their homes. It is certainly accurate to say that not all homeowners’ policies are created equal. See below for the three categories of homeowners insurance policies that you will need to consider.
1. Actual Cash Value: This is the most basic policy that you will find. Actual cash value only covers the cost of the house plus the value of your belongings after taking depreciation into consideration. Keep in mind that this will not cover the cost of what you paid for things but their current value after depreciation.
2. Replacement Cost: This policy covers the actual value of your home plus the cost to replace your belonging with no depreciation value taken into account. This policy allows you replace the actual cost of your belongings.
3. Guaranteed Replacement Cost: This is the most comprehensive policy available but also the most highly recommended. This policy takes inflation into account and covers whatever it costs to replace your home even if it exceeds the policy limits. There is usually a cap on how high above the limits the policy will cover usually 20-25%. This is the best way to make sure that you have enough coverage in the event of the worst-case scenario.
If you have any questions about the right coverage for your new home, please feel free to reach out to our team. As your trusted Westlake Realtor and real estate team we are always here to help you through the entire home buying process.