First-Time Home Buyer’s Guide to Home Insurance: Everything You Need to Know
So, you’ve found your dream home, your mortgage is in place, and now you’re told you need home insurance. But where do you start? Many first-time home buyers focus on their real estate agent and mortgage lender, often forgetting that homeowners insurance plays a crucial role in protecting their investment.
This guide will walk you through how home insurance works, who provides it, and how to ensure you’re getting the best coverage at the right price.
Click here to learn more about what home insurance covers!
What Is Home Insurance and Why Do You Need It?
Homeowners insurance protects you financially if your home is damaged by fire, storms, theft, or other unexpected events. Mortgage lenders require home insurance to protect their investment, but it also protects your home, your belongings, and even liability risks.
What Does Home Insurance Cover?
✔️ Damage from fires, storms, and certain natural disasters
✔️ Theft and vandalism
✔️ Personal liability (if someone is injured on your property)
✔️ Additional living expenses if you need to relocate due to damage
How to Get Home Insurance as a First-Time Home Buyer
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DescripThere are three main ways to buy home insurance for first-time buyers:
• Independent Insurance Agents – Shop multiple carriers to find you the best rate and coverage.
• Captive Insurance Agents – Represent only one insurance company.
• Direct-to-Company – Buy directly from an insurance provider without an agent.
💡 Pro Tip: Independent agents can compare multiple insurers, which often means better coverage at a lower price.tion text goes here
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DescripYour insurance agent will need some details, including:
✔️ Your new home’s address
✔️ Your current and past addresses
✔️ Your birthdate and basic personal info
✔️ The home’s age, condition, and any upgrades
Once they gather this information, they’ll calculate your home insurance premium and present a policy quote.tion text goes here
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Once you choose a policy, your insurance agent sends proof of coverage (often called an “insurance binder”) to your mortgage lender. The first year of insurance is usually paid through your mortgage escrow account at closing.
How Does Home Insurance Get Paid?
Most first-time home buyers pay their home insurance premium through their mortgage:
🔹 Your lender collects a portion of your insurance premium in your monthly mortgage payment.
🔹 That money is held in an escrow account and used to pay your insurance bill.
🔹 Your policy automatically renews each year, unless you switch providers or receive a non-renewal notice.
What Happens at Renewal?
Your home insurance renewal notice arrives about 60 days before your policy expires.
✔️ If nothing changes → Your policy automatically renews.
✔️ If your rate increases significantly → Time to review your options.
✔️ If you receive a non-renewal notice → You need a new policy before your current one expires.
💡 Tip: If your rate increases, ask your agent to shop around for a better deal. Independent agents can compare multiple carriers for you.
What If Your Home Insurance Premium Increases?
If you see a big jump in your home insurance rate, here’s what you can do:
✔️ Call your insurance agent – They can explain the increase and check for discounts.
✔️ Compare policies – Independent agents can shop around for better rates.
✔️ Check for discounts – Bundling home and auto insurance can help lower your costs.
When Should You Contact Your Insurance Agent?
A good home insurance agent is there for you beyond the initial purchase. Reach out if:
✅ You have a home insurance claim (fire, storm damage, theft, etc.).
✅ You want to review or update your coverage (after renovations, adding security systems, etc.).
✅ You receive a non-renewal notice and need a new policy.
✅ You think your home insurance premium is too high and want a better deal.
Final Thoughts: Protect Your New Home the Right Way
Buying a home is exciting, and home insurance is a key part of protecting your investment. A great insurance agent will help you understand your coverage, find the best rates, and be there when you need them. If you have questions about home insurance, reach out today! We’re happy to guide you through the process and make sure you have the right protection.
🔹 Thinking about switching insurance providers? Contact us for a free home insurance quote today!
