Introduction to Homeowners Insurance for Littleton CO Real Estate Buyers

December 21, 2016

First-time home buyers may feel a bit over their heads when they begin to search for a home on the Littleton CO real estate market. If you’ve never owned a home before, one of the things you may need some clarification on is homeowners insurance. This can be a tricky subject, so we’ve rounded up all of the information you need to know to simplify it for you. Here’s an introduction to homeowners insurance:

What is it?

Just like car or medical insurance, homeowners insurance provides you with financial protection from damages that are out of your control. For example, if your roof is damaged in the middle of a hailstorm, your homeowners insurance policy should cover the cost of repairs.

Homeowners insurance also protects you from any liability in accidents that occur on your property. If someone slips and injures himself walking up to your front door, your insurance company may have to pay to compensate him for these injuries, but you will not be legally required to do so.

Homeowners insurance does not cover the cost of repairs for issues that were caused by your failure to take care of the property. In order to be reimbursed for the repair, you will have to be able to show it is not a maintenance-related issue. Learn more about how homeowners insurance works.

Is it required?

If you’re buying a home with the help of a lender, you will most likely need to provide proof of homeowners insurance prior to the closing. Lenders want to ensure the property they are helping you purchase will be taken care of over the years, and homeowners insurance provides them with that reassurance. If you’re paying for the home in cash, you don’t have to buy insurance until after closing, but it’s recommended that you get it as soon as possible so you are protected right away.

What damages does it cover?

Each homeowners insurance plan is designed differently, so you will need to do your research to determine which plan is right for your needs. Most policies do not cover flood insurance unless you specifically request to add it on and pay additional fees. Before making these kinds of decisions, speak to a real estate agent to determine what type of coverage you should get for the property.

How much does it cost?

Unfortunately, it’s difficult to predict how much homeowners insurance will cost as it is different for each applicant. The amount you will have to pay depends on a number of factors, including your personal credit score, the location of your home, and which coverage plan you choose.

You should always shop around to compare prices with different insurance companies before settling on one. Insurance is a competitive market, so companies may be willing to work with you to offer you a better rate if you mention you are getting quotes from other companies as well.

Now that you understand the ins and outs of homeowners insurance, it’s time to find a real estate agent who understands your needs. Contact us at 720-220-2059 to talk to the experienced agents at Colorado Home Sales.