Each year, millions of people buy homes. Most know that a realtor and mortgage lender can be a huge help in the process.
A little-known secret though, is that an independent agent can be equally valuable in the home-buying process – providing critical information that can help you with your home-buying decisions. Here’s how your independent insurance agent can be of assistance.
- Local experts
Independent insurance agents are local experts, deeply involved in the community. If you have yet to select a realtor or home inspector, your independent insurance agent can likely provide recommendations of local professionals. Your agent will also be able to share details about neighborhoods, school systems and community safety.
- Cost of coverage
Once you narrow down your list to a few houses, your independent insurance agent can give you an estimate of what it will cost to insure the house. Remember, the neighborhood, the size of the home, the presence of a pool or trampoline, and the distance from a fire hydrant and fire station are just a few of the things that can impact your home insurance premium.
As homeowners insurance is required by most mortgage lenders, this estimated cost-of-insurance figure, along with escrow payments for taxes, will need to be calculated as part of your total monthly payment to determine affordability of the home.
- Coverages to consider
When purchasing a home, you will want to consider more than just basic coverage to ensure you are protected from the unexpected. Your independent insurance agent can walk you through the merits of having added-value coverages such as guaranteed replacement cost, water backup, service line, ordinance or law and debris removal.
Your independent insurance agent can also explain the difference between the market value and the replacement cost of your home, and why it’s important to insure your home for the full replacement cost value.
- Previous claims
Insurance claims filed by previous owners can impact your home insurance premiums. Your independent insurance agent should be able to access this information using the comprehensive loss underwriting exchange (CLUE). If several claims have been made on the property, insurance carriers may be concerned that the house may have long-term problems, resulting in higher premiums. It is particularly important to pay attention to water damage claims that have been filed.
- Reviewing your home inspection
Once your choice home is inspected, it is a good idea to share the report with your independent insurance agent. Your agent can highlight any red flags that might impact insurance rates, such as the age of the roof, other building materials and the electrical system, cracks in the foundation, the presence of mold or leaks, damage from rodents and more.
Learn more about the value of working with an independent agent and the difference between captive and independent insurance agents. And, remember, when you find a new home, you don’t need a new agent. Your current agent has all your information, including other policies with loyalty credits, and knows your current coverages and limits. This information will allow your agent to tailor a package for your new home that continues to offer you the best combination of coverages, value and price.