June Homeownership Month: Essential Insurance Tips

June marks National Homeownership Month, a time to celebrate the journey of owning a home. It’s a milestone filled with excitement and a doorway to new responsibilities, including managing your financial commitments and understanding the importance of adequate insurance coverage. Let's explore three key insurance considerations every new homeowner should understand to protect their investment.

 

Review Your Life Insurance Coverage

 

Buying a new home often changes your financial landscape, which can impact your life insurance needs. For those upsizing, increasing your coverage may be wise to ensure that your mortgage is fully protected, offering peace of mind that your home remains secure for your loved ones no matter what life throws your way. Conversely, if you’ve downsized, you might have the opportunity to reduce your coverage, aligning it better with your new financial scenario.

 

Consider Additional Coverage

 

Standard homeowners insurance may not cover all situations. It's essential to examine areas like liability coverage, umbrella policies, and especially flood insurance. Surprisingly, flood insurance is typically not included in standard policies, despite floods being a common risk. Assess your specific risk level and add coverage as necessary to ensure full protection against unforeseen events.

 

Understand Escrow and Insurance Premiums

 

Most homeowners pay their insurance premiums through an escrow account managed by their lender. This arrangement simplifies payments, as your lender typically handles the actual transactions. Occasionally you might receive a bill directly from your insurance provider, but rest assured, it’s usually being managed. However, it's worth double-checking with your lender if any payment questions or discrepancies arise.

Understanding and managing home insurance is crucial to safeguarding your home and financial future. Take the proactive step today to review your policies, consult with professionals if needed, and secure peace of mind for the journey of homeownership.