June is National Homeownership Month, a time to celebrate the exciting milestone of buying a new home. With this achievement comes the realization that homeownership entails not just joys but also responsibilities, particularly in terms of financial and insurance planning. To safeguard your new investment, it’s essential to have the right insurance strategy in place. In this post, I'll share three crucial insurance tips to help you protect your home.

 

Understand Escrow and Insurance Premiums

 

As a new homeowner, it’s common to pay your insurance premiums through an escrow account managed by your lender. This means that even if you receive a bill from your insurance provider, your lender will typically make the payment using the funds collected through your mortgage payments. To avoid any confusion, confirm with your lender if you have any questions about the payments. This reassurance can give you peace of mind and ensure that your insurance coverage remains uninterrupted.

 

Consider Additional Coverage

 

Standard homeowners policies often provide basic protection, but they don’t cover everything. It’s crucial to evaluate your potential risks and consider additional coverage options such as liability insurance, umbrella policies, and flood insurance. Remember, flood insurance is not typically included in standard homeowner policies, so assess your area's risk and add coverage if it’s deemed necessary. Ensuring you have comprehensive coverage keeps your home and lifestyle protected from unexpected events.

 

Review Your Life Insurance Coverage

 

When you purchase a new home, it’s a good time to reassess your life insurance needs. If you’ve upsized your home, consider increasing your coverage to ensure your mortgage is fully protected. Conversely, if you’ve downsized, this might be an opportunity to reduce your life insurance and adjust your policy to better fit your current financial situation. Tailoring your life insurance coverage helps maintain financial stability for your loved ones, regardless of life’s changes.

Understanding and managing your insurance policies is a crucial aspect of protecting your home and securing your financial future. If you're unsure about your coverage or want personalized advice, consider reaching out to a financial expert or scheduling a policy review. This proactive approach ensures that your insurance strategy provides the protection you need.