Home Insurance: 3 tips to get the right policy

Read on and find out how you can get the right coverage on your home insurance policy without spending a fortune.

09:38 11 July 2013

Taking out home insurance is one of the best things that you can do to protect one of your biggest investments – your home. When taking out this type of policy, its very important to ensure that you’re not paying more than you should and that you’re getting the right coverage that compliment your needs.

Here’s what you need to do:

1.    Avoid monthly payments. Most people find the “pay monthly” option to be more attractive compared to paying the whole amount all at once. However, you need to know that most insurers will just loan you the annual cost and will make more money by charging you outrageous interest. So, your best options are to pay it in full or use a credit card with lower APR.

2.    Rebuild value vs. market price value. One of the most common mistakes of homeowners when they take out home insurance is that they ensure their house for its market value. In order to save, get a policy that will cover the rebuild value. This is typically much cheaper but it provides coverage for the whole rebuilding cost should your house get knocked down.

3.    Get the right coverage on contents. You cannot afford to under-insure the contents of your house as this may give you financial troubles in the future. Add up everything including smaller items. In case of flood or fire, you don’t have to worry as to where you’re going to get the money to replace all your belongings. This should definitely give you peace of mind.