Real Estate

How To Save Money On Homeowners Insurance As a First-Time Homebuyer?


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When you finally buy a home, finding the best suitable homeowners insurance for you is of utmost importance.  Buying that dream home after years of hard work is one of the most fulfilling feelings. Having your own home is an essential step towards a secure and happy future.

Is It Cheaper to Insure a New Home? 

The answer to this question is yes. Buying a new home will help you save money on homeowners insurance. It is cheaper to insure a new home because the risk of unfortunate events is relatively less. This is because new condos, buildings, and houses are built with strict compliance with stringent safety codes.

Buying a new home ensures that the quality of construction is top-notch and that the building is in a healthy condition. If you decide to buy a relatively old house, you should hire a home improvement contractor with proven experience for reparations and remodeling before you move in.

What Insurance Do I Need as a First-time Homebuyer?

Homeowners insurance protects your home and belongings against a variety of events. There are four fundamental types of coverage — dwelling, other structures, personal property, and liability. As a first-time homebuyer, you need insurance that offers all four types of coverage. 

  • Dwelling coverage will help you in claiming insurance for repairing your house in the case of damages caused by events like strong winds or fire. 
  • Other structures’ coverage will safeguard detached properties. For example, if your shed gets damaged due to floods or fire, other structures’ coverage will help pay for its repair.
  • Personal property coverage is ideal for safeguarding all the belongings in your home against catastrophic events. Electronics, clothes, and furniture are all covered under personal property coverage.
  • Liability coverage is helpful in the event of someone getting injured at your property. This type of coverage also comes to the rescue if you accidentally cause damage to someone else’s property.

Tips to Save Money on Insurance as a First-time Homebuyer

1. Purchase the homeowners’ insurance a bit early

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Starting any task early is beneficial. When starting a business, competitor research is vital for learning how you can stand apart. Similarly, when it comes to purchasing the right homeowner’s insurance, researching has its benefits. 

If you buy the first insurance that seems good to you, you can miss out on better deals. Therefore, it is imperative to approach different insurance companies, talk to their agents, and completely understand the deal you are getting. Comparison of insurance providers is highly recommended for finding the most suitable deal. 

This will help you save a significant sum. Choosing the right homeowners insurance can be hectic, but remember, it is better to spend time choosing the right insurance provider than regret later.

2. Buy renter’s insurance 

A renter’s insurance protects the belongings of the tenant in case of unfortunate events like theft or fire. Most of the time, landlords insure their buildings. But this insurance specifically protects the building and not the belongings in it.

With a renter’s insurance, the tenant will be able to file a claim against theft or loss of belongings irrespective of the nature of the landlord’s insurance. In addition, having renter’s insurance at least for a few years before buying a new home will get you a discount on homeowners insurance. 

If you have had renter’s insurance and never made a claim, the discount you can get on homeowners insurance can help you save money on premiums. 

3. Choose the right coverage over the least monthly payments 

Low monthly premium rates are tempting. There is no arguing that. Many first-time homebuyers look for insurance with minimal monthly premiums. But ask yourself, is saving a few hundred dollars more important to you than the safety of your home and your belongings? 

Choosing the right coverage that offers maximum protection depending on the location and possible threats should be your goal. By all means, you should look for a better deal that can provide you with maximum protection and save money at the same time. It is only problematic if you choose your insurance solely based on the least monthly payments.

4. Be smart about filing a claim

This is one of the most important tips for those with homeowners insurance. Being smart about filing a claim can help you get the maximum amount from your insurance provider in case of an unfortunate event. Keep the following things in mind while filing a claim.

  •  Keep all the claim-related documents ready
  • Inform your insurance provider as soon as possible after an unfortunate event has occurred
  • File the claim before the window closes. Every insurance provider has different windows before which your claim should be filed.
  • Be patient. Your insurance provider will ask many questions that are part of the claim settlement procedure. Being patient and providing all the required details will help you get the maximum claim in the shortest time.

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5. Bundle home and auto insurance for discounts 

Ever seen the buy two get one free offer at the supermarket in your neighborhood? Insurance providers also offer something like this to their customers. So if you want to save money while purchasing your homeowner’s insurance, make sure to bundle it with auto insurance. 

Buying multiple insurance policies from the same provider is beneficial for both parties. The insurance provider will receive more premiums, and you will get a spectacular discount. Talk about a win-win situation. 

6. Don’t skip the home inspection 

A home inspection is a vital stage in the process of buying homeowners insurance. For example, let’s say you purchased a new home and you want to get it insured. Now comes the question of how much should the insurance amount be?

Choosing the right insurance amount is essential. If you pick a lower insurance amount, you will end up paying from your own pocket in the case of an unexpected tragedy. To avoid this and determine the proper insurance amount, getting your home checked by an experienced inspector is a must.

Picking the right homeowners insurance is tricky. There are so many things to be considered that can easily overwhelm you. However, if you follow the simple tips mentioned in this blog, you can save money on insurance as a first-time homebuyer while opting for optimal coverage. 

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