Homeowners insurance mistakes can end up costing you. If you’ve recently purchased a new home or are browsing the market for a new insurer, you’ll need to know what common pitfalls most homeowners make in their policies. By avoiding the following mistakes, you and your agent can design a policy that’s right for you.

Common Homeowners Insurance Errors 

1. Choosing Only the Standard Policy

Most standard policies will cover certain types of damage to the structure of your home, loss of personal belongings, and liability protection. Many also cover expenses incurred if an emergency evacuation becomes necessary. However, most don’t include many common issues, such as floods or damage from termites. Find out what the risk levels are for your area and add supplemental coverage as needed. 

2. Underinsuring Your Home

Two-thirds of homeowners are underinsured, which could be a costly mistake. Homeowners tend to only cover their mortgage or the cash value of their home, not realizing that it won’t be enough to cover costs if the property is completely destroyed. Get an assessment of how much it will cost to rebuild your entire home, including estimated labor costs and raw materials.

3. Setting Your Deductible Too High or Low

A deductible is the amount you’ll have to pay toward damages before insurance coverage kicks in. Setting it too low might be uneconomical, as your premium costs may be high. A very high deductible could also be a mistake, leaving you unable to pay for damages. Look at your finances and determine what you can afford over the short- and long-term, and talk to your insurance agent to set a deductible appropriate for your needs. 

4. Not Reading Your Entire Policy

Every homeowners insurance policy will have stipulations and limits. While you can always add riders and floaters at a later date, since it’s hard to predict when disasters will strike, you won’t want to be caught without coverage at an inopportune time. For example, the total value of your expensive jewelry may not be covered under personal belongings and will require a floater for you to file a claim. Make sure you’ve read and fully understand the implications of your chosen policy. 

If you’re searching for a trustworthy homeowners insurance agency, there’s none more reliable than Farmers Mutual Insurance Association in Sibley, IA. Established in 1889, they now have 1,600 policyholders and offer lower rates for insurance coverage than most other companies. Their expert team will set you up with the right home insurance, farm insurance, or mobile home insurance to cover your property and liabilities. Call (712) 754-3654 to request a quote or visit their website for more information.