insurance - a necessary Evil

CONNECTING YOU WITH THE KNOWLEDGE YOU NEED!

Insurance, to me, is sort of like buying gas for the car, a necessary evil.  I know that is a negative way to start this newsletter, but one of the most problematic issues I come across in Real Estate, lies with insurance issues.

If you have a mortgage, you are required to have insurance on your home.  To save money, people often get minimum coverage and high deductibles, to lessen the impact on their monthly payments.  However, if you don’t regularly ‘shop’ your insurance, you may be shooting yourself in the foot.

When you don’t have a mortgage, and either rent, or have paid off your property, you may decide you can’t ‘afford’ the insurance and just do without. 

Not having insurance may not be a problem, until it is.

I had a client whose home was paid off and had insurance, but only kept minimal coverage.  After multiple storms, the homeowners decided to get their roof checked.  Of course, the insurance company said they needed a new roof, but because the high cost of their deductible, the decision was made not to get the roof repaired at that point.  When said clients contacted me about listing and selling their home, they had to disclose the roof issue.  But because they had waited a few years before addressing the roof, the amount of damage had deteriorated.  This decision cost them dearly when the home sold, having to get the entire roof replaced prior to closing, and the insurance company depreciated the initial payment amount, because of the additional damage.

When speaking with new, or first-time homebuyers, they are often surprised how much the property taxes and insurance affects their monthly payment.  Most are not aware that they should keep the amount of their deductible in savings, so they can afford to get repairs done quickly. 

Another concern is the coverage available based on the kind of home desired.  Their dream home in their dream location may have a greater insurance impact, than having that same home in a different location.  Access to fire hydrants, fire departments and the area rating by the insurance company, all may affect the cost.

Many insurance companies also bundle insurance to provide discounts and ease of accessibility. 

It is also a good idea to ask your agent about an ‘umbrella’ policy.  It is usually only a few hundred dollars annually, providing coverage for the things that other insurance policies don’t.  Most people don’t understand that their policies have limits as to what is covered.  Then they are surprised when they find out that personal injury to a repairman while on your property may not be completely covered by your homeowners’ policy, but an umbrella policy may protect you for the additional costs.

Finally, make sure to ‘shop’ your policy annually.  When you purchase a home, you will pay for your first year of insurance at the time of closing, then the mortgage company will collect a monthly amount to be put back into an escrow account to pay the premium to your insurance company the next year.  A month or two prior to your annual call around, or if you have an insurance broker, ask them to ‘shop’ your policy to see if you can get better rates.  Some insurance companies raise rates a little each year.  If you aren’t careful, it can increase your monthly payments quite a lot.  But by shopping your policies each year, (home and auto), you may be able to decrease your payments and sometimes get better coverage and deductibles in the process.  Take advantage of bundling when you are ‘shopping’ and make sure you have all the coverage you need.
 
Bottom line, take care of your insurance and your home and it will take care of you.  Make sure to make repairs at the time of damage, and when you are ready to sell, you will get the most out of your sale.

No, I don’t sell insurance, but I have learned the hard way, why good insurance coverage is so important.  And if you are thinking about buying or selling, give me a call.  I would love to help talk you through the process, and remember, a conversation is free.

A great article by Texas A&M Real Estate Center, discussing insurance and the February deep freeze is linked here:  ​Storm Warning: Winter Blast a Harsh Reminder of Need for Homeowner's Insurance - Texas Real Estate Research Center (tamu.edu)

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Connecting you with Fun Happenings and Places!!!

Did you know that Wise County partners with Tarrant County for some amazing resources for families.  Are you getting a little one ready to start Kindergarten?  There is an online class tomorrow to help.  We also have a Headstart Program, parenting classes, Autism awareness classes among, many, many other things to help families.  Take time to check out all of the amazing resources MHMR has available.  Go to
Early Childhood Services | MHMR Tarrant | We Change Lives (earlyisbestnorthtexas.org) 

It is no secret that many teachers have to pay out of their own pocket to teach.  While they do get a paycheck, many in Wise County do not get paid what other districts pay, they choose to stay in the communities they love at great expense to their time and pocketbook.  If you want to help them with the things that can make their classroom special, reach out.  

Many Facebook Groups have popped up in Wise County to help you adopt a teacher.  Just go to the search bar and look for one you may wish to help and join.  I live in Alvord, so here is a link to Alvord's group.  But please find one, even something as small as a gift card can go a long way to helping ease the burden on our teachers.  
(20+) Alvord ISD Adopt a Teacher | Facebook

May you have a blessed week and weekend and please let me know if I can help you with any of your real estate needs!