As we know only too well, real estate and insurance go hand in hand. You wouldn’t want to leave your most significant asset unprotected and if you have a mortgage, you are required to hold adequate insurance on your home. To get the skinny, I sat down with Ryan Hartwigsen, of Allstate Insurance, 4080 Centre Street, Suite 107 in San Diego. Here is that interview:
What do new homeowners need to consider when they cover their homes?
Ryan Hartwigsen: Buying a home can be an exciting but stressful process. There is a lot to consider; securing a loan, scheduling the inspection, getting home insurance quotes. Insurance is expensive and you should know what you are buying so that you don’t have any surprises down the road should you ever have to file a claim.
How can I determine how much coverage I need?
This is where an agent can really help. Insurance can be confusing so it’s often hard to tell what coverage you really need. Further, once you decide which coverages you need, we will advise your limits. Everyone is different and it takes an agent to develop a custom solution for each person.
What happens if I don’t buy enough insurance; if I’m under-insured?
First and foremost, new home buyers need to make sure that they have adequate coverage to rebuild their home. To do this, we use a third party company who aggregates building information (like the cost of building materials, architectural fees, labor costs, etc.) and combines this with property data to develop replacement cost. However, if you think the estimate to replace the home is too low, definitely discuss this with your agent.
Secondly, you should review your policy with your agent on an annual basis to make sure that your policy keeps up with changes in your life.
Do I need an umbrella policy?
Umbrella policies increase your underlying liability limits in increments of $1 million.
For example, if you were in an auto accident and the person driving the other car decided to sue you, and the judgment was for $1 million, the first $250,000 would come from the auto policy; the balance would come from the umbrella policy. When people ask if they need an umbrella policy, I typically tell them to imagine that all of their assets are in a pile on their front lawn. If someone were to try to come by and take those assets, how high would we have to build the wall around those assets to make them safe? If the wall is high, then we need to consider an umbrella policy.
Is there anything else you think is important that readers should know about insurance?
When thinking about insurance, it’s important to consider a total risk management approach. As an agent, it is my responsibility to make sure that you are prepared for any situation, no matter what comes your way. For example, you know that you need to purchase a homeowners policy to protect your home from a fire or weather damage. But what about the debt of a mortgage loan should something happen to you? Perhaps you need to consider a life insurance policy to help pay off the debt. What about if you are injured and can’t work for a while? What can we do to make sure that you have enough income to make your mortgage payments? Working with an agent to develop a plan can help give you peace of mind.
Thanks so much Ryan.
You can reach Ryan Hartwigsen at: rhartwigsen@gmail.com
