June is National Homeownership Month, a special time to celebrate achieving the dream of owning a home. This achievement comes with both excitement and its set of challenges, especially those related to managing the new financial and insurance responsibilities that come with it. Recognizing these challenges, this blog post will guide you through three essential insurance tips to help you preserve and protect your valuable investment.

Consider Additional Coverage

Many new homeowners assume that their standard homeowners insurance will cover all potential risks, but this might not be the case. It’s wise to assess your current policy to ensure you have complete protection. Consider bolstering your liability coverage or adding umbrella insurance to cover gaps not addressed by your standard policy. Importantly, remember that flood insurance is typically not included in standard policies. Evaluate your property's risk level for flooding and ensure you have appropriate coverage, especially if you’re in a flood-prone area.

Understand Escrow and Insurance Premiums

Managing insurance payments through an escrow account can simplify financial responsibilities, as many homeowners do. Lenders often manage escrow accounts to ensure timely payment of insurance premiums and taxes. If you ever receive an insurance bill directly, don’t panic; your lender usually takes care of these payments on your behalf. However, it’s prudent to confirm these arrangements with your lender, especially if you have questions or if there are changes in your premium rates.

Review Your Life Insurance Coverage

Homeownership is a transformative event that may necessitate a review of your life insurance policy. If your new home comes with a larger mortgage, you might need increased life insurance coverage to secure your family’s financial future and ensure your mortgage is fully covered in any unfortunate event. Conversely, if you’ve downsized, your insurance needs might decrease, allowing you to adjust your coverage to better fit your financial situation. Regular reassessment can help align your policy with your current lifestyle and obligations.

Understanding these insurance aspects is crucial for keeping your home and financial future secure. If you're uncertain about your current policy or coverage needs, consider reaching out for a policy review or consulting a financial expert for personalized guidance.