By Trevor Pachis, Principal Agent, Pachis & Associates, Inc / American Family Insurance
We all know that we need homeowners insurance, but for the homeowner to get the coverage that fully protects their largest investment, they need to fully understand what “is” and “is not” covered within the policy. Understanding coverage before you purchase it puts you in control and ensures you get the right one for you. So where should you begin?
The best answer: Find an Agent.
An agent’s role is to uncover the client’s true needs for a policy and then find the best coverage options for them. Some considerations include preventative measures, risk, and budget. Once identified, a home insurance program can be customized to meet the client’s specific needs.
Policies today are flexible and customizable.
Depending on your risk tolerance, you may decide you need just a basic policy in order to keep costs low. If you are less comfortable with risk, on the other hand, you may decide that you’d prefer a more robust, comprehensive policy. When choosing an Insurance Agent, I suggest you allow them to advise you on what coverage they recommend and why. This will show you if the Agent is simply offering the “cheapest” or is basing the coverage options on your specific needs.
What an “apples to apples” quote means.
Looking at “apples to apples” is a good way to compare costs, but the existing policy might be inferior, lacking the appropriate coverage, so the replacement policy would be inferior too. As a result, this type of comparison doesn’t put you in a better position for protection or help you understand any potential gaps. We’ve found a better way to help clients understand their situation is through a comprehensive spreadsheet which compares the existing policy to the recommended coverage options.
Often, the recommended coverage is more expensive. But by knowing all of your options, you can them make informed decisions if spending your money for coverage is a good value to you. We can then customize your home protection program based on your tolerance for risk.
The bottom line: look for an Agent you can trust and guide you in the process we just described, not the one who is not trying to sell you the lowest possible price, sacrificing coverage now for potential disappointment down the road. After all, the worst time to learn that your policy isn’t adequate is at the time of a loss. Knowledge is key. And, best yet, you might also be surprised to learn that the cost of good quality coverage is actually reasonable.