The informed purchase of your homeowners insurance can be the most important minutes you invest into the purchase of a home.
So, you’ve purchased your new home, navigated the rigors of escrow including home inspections, termite tenting, title searches, legal wrangling, paper work, signatures, delays, changes, lost documents, unreachable loan officers, and the dog ate my disclosure!
Then you get the call…”I’ll need a copy of your homeowners insurance to close escrow TOMORROW!“
So now what ?
If you’ve done the following…..YOU WON’T EVEN GET THE CALL! EVER!!!!!
There’s a few simple steps you can take to avoid this last minute panic.
- Contact YOUR insurance “team member” you trust EARLY in the escrow (like the day you open). (he is a member of your team that helps you avoid ulcers during escrows.)
- Your agent then gets completely ready w/ the information, inspects the house, relays his information (phone, fac, etc) to escrow and waits. (Check to make sure he’s going this. Sometimes escrow contacts him when there’s like 20 minutes left till the rate lock expires….) Make sure he’s all “warmed up” and ready to go just like the pitcher in the bull pen.
What should you look for.
You need to primarily consider 3 major points of the insurance. (there’s MUCH more to it than this and you can read about that HERE.) This is just a quick peek at the basics of what you should look for.
- INSURANCE TO VALUE – HOW MUCH? People need to insure their homes to the COST OF CONSTRUCTION of the home. Not the sales price, not the loan amount, but the amount of money it would take to rebuild in the case of a total loss. Living thru the TWO MAJOR SAN DIEGO FIRES in 2004 and 2007, I can tell you that this can be a PROBLEM. Get insured correctly going in the front door and the renewals should increase to keep pace (but check ’em out anyway…that’s why they mail you an annual renewal notice.)
- Get a good amount of Liability Coverage. This is the , GAWD, I’M GETTIN SUED coverage. Think minimum of $500,000 and maybe even a $$MILLION$$.
- Don’t take too low a deductible. Many clients take $2000 up to $5000 and even $10,000 deductibles for substantial reduction in their premiums. Look at the numbers and decide.
That’s just a short view of the INSURANCE portion of your escrow. Most important, get an insurance agent you trust that will take good care of you and who will get to know you BEFORE he recommends coverage. Everybody’s different with different insurance needs.
Find an agent that you can call who is willing to spend the time with you to be SURE you new home is adequately and COMPLETELY insured!