Know Your Insurance

When I purchased my first house I did not have my house inspected; they did not do that back then.  It was a “buyer beware” type of atmosphere.  You could bring a friend along with you to look at the house.  Hopefully, your friend knew every aspect of home construction.  If you did not have a friend or family member that knew about building construction, you were left to trust your realtor who was trying to make a sale.

 
Times have changed.  There are companies that provide building inspections and a report about a building prior to purchase.  Based upon this inspection, that the buyer pays for, recommendations can be made to repair unseen imperfections.  Knowledge is very powerful when you buy a home or a building. 

 

Armed with no inspection, I purchased my first home.  My second critical error began with my realtor’s statement, “You need insurance.  I will find out who the buyer has and then have them rewrite it in your name.”  That sounded perfect to me.  I knew nothing about home buying, insurance, mortgages and the list of all that I did not know continued.  I was also overwhelmed with all I needed to do and the information that everyone wanted.  Having someone offer to take a task off my plate was wonderful.  Until…

I started working at DGK.  I looked at my homeowner’s insurance policy.  The very minimum you want for your home or any building is replacement cost and special form coverage.  Well, my home was not on replacement cost and it was not on special form.  Not only did I not know what insurance I had on my home I also did not have the proper kind needed.  That was an eye opening experience for me.

 

I bought my insurance on three criteria: it was easy, the price was acceptable and the bank accepted the insurance documents for closing.  Once I bought the insurance, I stayed where I was. I never bothered to learn ANYTHING about my insurance.  I did not ask questions; did I even know what to ask?

Does this insurance replace or repair my home in case of a claim? Does it cover my belongings in the same manner?  How much is my deductible?  What happens when I rent a vacation home at the beach; are any of my belongings covered at the beach house?  What exactly is liability insurance?  What happens if my sump pump does not work and the drains back up?  Do I get any discounts for insuring my automobile with you?  In my case, my car was insured with a different agent and neither asked or told me about a two or more policy discount. 

Luckily, I did not learn the hard way: through having a claim not covered.  I have been fortunate that I do not utilize my insurance and I hope that continues.  I practice risk control as much as possible.  I moved my car and home insurance to DGK and received a multi-policy discount.  In my case, I learned through work what I needed for coverage.  I obtained correct coverage and since I serve on Boards of nonprofit agencies, I have an umbrella policy too; no one asked me about that.  What I do now, along with my coworkers, is teach our clients about insurance coverage. 

Some insurance coverages are a huge “bang for your buck” like rental car coverage, scheduling your diamond engagement ring, increasing your liability on your home especially if you have a dog, adding back up of sewer and drains and many other coverages that are specific to your needs.  My advice, besides buying your insurance from DGK, is to ask questions, research your policy, call different insurance agents, and find a “fit” where you are happily informed.  The cheapest and easiest insurance could be a very costly mistake that is nowhere near an easy button.