If you are buying your first house in Texas, an essential part of your purchase transaction is buying a homeowners insurance policy to protect your investment and personal property.
Home owners insurance is similar to other types of insurance as it provides you with affordable protection against common risks that could damage your house and be costly to repair or replace.
To get the most from the policy you purchase from a local homeowners insurance agency and understand how it works, check out these basic facts about homeowners insurance!
How Are Basic Homeowners Insurance Rates Calculated?
Because homeowners insurance rates are calculated based on a number of factors, no two policies are exactly the same.
Your rate is calculated based on variables like home value, location, risk of natural disasters, crime rates, and more.
Other factors include age and size of the dwelling, architectural style and construction, replacement and repair costs, and the value of all personal items kept within the home or on the premises.
The deductible amount will also affect how much you pay in premium.
What Does Basic Home Owners Insurance Coverage Include?
Every home owners insurance policy starts with basic coverage that protects any house against the common perils and hazards that could affect it.
A typical policy from a homeowners insurance agency offers coverage for fire and smoke damage, theft, lightning, ice and snow damage, frozen pipes, and other physical damage to the structure.
The policy also provides coverage such as lodging and expenses if you are unable to live in the house while repairs are being made.
If someone is injured while at your house or on your property, there is liability coverage as well as a no-fault medical coverage that pays for associated medical costs plus any court costs if you are sued by the injured party..
How Are Home Owners Insurance Claims Handled?
When you suffer a covered loss, you must report this to your insurance agency so that claim processing can begin.
Your insurance company will send an estimator to inspect the damage, determine what it will take to repair or replace it, and confirm that the damage incurred is covered under the existing policy and can be approved so repairs can begin.
If for any reason your claim is denied, you have the right to challenge that denial, so it's important to keep detailed paperwork of everything involved with the loss including any necessary bills you may have paid to mitigate the damages.
If you are unable to work with your insurance carrier, you have the right to file a complaint with the Texas Department of Insurance that you can reach at (800) 252-3439.
What Is A Deductible?
Your homeowners insurance policy has a deductible, which is the amount you agree to pay before your homeowners insurance policy begins to pay the rest.
The higher your deductible is because you’re willing to pay more when a loss occurs, the lower your yearly premium will be and vice-versa.
Choosing the amount of your deductible is your decision to make.
What Are The Exclusions On Homeowners Insurance Policies?
When choosing a homeowners insurance policy for your home and deciding on coverage amounts and types, it is critical that you pay attention to what is excluded from the basic policy.
Most policies exclude things such as flood damage, nuclear accidents, damage due to acts of war or terrorism, and earthquakes.
Fortunately, you can purchase additional insurance to cover excluded events such as flood damage by paying attention to the listed exclusions on the policy.
Know Your Texas Home Owners Insurance Policy
Homeowners insurance is an essential protection that covers your house against the inevitable hazards that can cause damage over its lifetime, so it’s important to understand how home owners insurance policies work and what to expect from them.
Work with an experienced homeowners insurance agency to be certain that you purchase a policy and any additional coverage to sufficiently protect your house and personal items from the risks of daily life!
