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More people seek new ways to fund their houses or investment property as home values skyrocket. Many homeowners consider adding insurance coverage for their new homes. Others may opt to increase the insurance on their current one. Ensuring your house is adequately insured can help you save money on various costs associated with housing. This includes taxes and interest payments on debt secured by your property. Here are some investment property tips on how to increase insurance coverage for your home and maximize your savings.Here are some tips on how to increase insurance coverage for your home and maximize your savings. Click To Tweet
Understand the Value of Your Home or Rental Property
Suppose you are buying a home or refinancing an existing loan. In that case, it is essential to understand the value and scope of your investment. You should take steps to ensure you have enough coverage to protect yourself from unforeseen costs in the future.
At the same time, when getting high-value homeowners insurance, you do not overinsure your assets. There is no sense in over-insuring when you can get adequate protection at an affordable price. In addition, there is no point in spending more money than necessary on insurance when your overall goal is saving money.
Consider Taking Out a Mortgage Insurance Policy
Suppose your home or investment property loans are backed by the Federal Housing Administration (FHA). In this case, you may be able to take advantage of mortgage insurance policies provided by private insurers.
If you default on your payments, these policies protect the lender on FHA-backed loans. However, they allow you to deduct your income taxes. Contact a tax professional before claiming any deductions so you do not overpay for your coverage.
Have a Written Budget for Your Real Estate Investments
When paying for your house or investment property with a mortgage, having a written budget that lays out your planned expenses can be helpful. This budget lets you know exactly where to get the money needed to pay for home insurance through Coastal Insurance Solutions, among other reputed insurance firms.
The budget also gives a better estimate of the costs associated with insurance premiums. Also, having a written budget will make it easier to determine if you have enough money to pay for additional coverage.
Consider Adding More Home Insurance Coverage
More people are purchasing investment properties in recent years. As a result, there is also more risk if they choose not to protect their assets. If you are investing in a second home or an investment property, one of our top investment property tips would be to invest in additional insurance to help protect your investment.
Consider speaking with an experienced independent agent about finding coverage tailored to your individual needs.
Create a Fail-Proof Insurance Plan for Emergencies
In addition to making sure your home is adequately covered by insurance, it can be essential to have a backup plan if something unexpected happens. Suppose you have enough coverage and discover that there are areas where you feel like you need more protection. In this case, you may consider raising your deductible to lower premiums.
Another option will be to add more protection for yourself if the worst happens. When deciding where to place your home insurance premiums, think about whether you have the right coverage. If you do not, consider increasing your range. Homeowners may also work with an independent insurance agent who can help determine if they are getting the right coverage at an affordable price.
Home Additions Can Change Your Insurance Coverage
Changes in your home’s configuration might affect your home insurance coverage. Even if you want to build a new home or buy an income property, your current homeowner’s insurance policy may not be sufficient.
Insurance companies reserve the right not to insure certain aspects of a home’s construction or design. Homeowners should carefully consider the provisions in your policy if they are embarking on multiple additions. Each addition may require a separate contract with an investor.
Final Investment Property Tips
Remember to always consult with a trusted financial advisor and/or real estate agent before making any final decisions – they will be able to help guide you through the process and answer any questions you may have.
These insurance investment property tips will help you protect your new home and income properties. And finally, good luck! We believe in you.
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Krystle Cook – the creator of Home Jobs by MOM – put her psychology degree on a shelf and dived into a pile of diapers and dishes instead. She is a wife and mother to two rambunctious boys, sweating it out in her Texas hometown. She loves cooking, DIY home projects, and family fun activities.