Buying a home is a huge undertaking and responsibility. You have to think about the cost of the property, as well as additional expenses, such as property taxes and homeowners insurance

6 Key Insurance Factors To Consider Before Buying A Home

Updated on

Brenda Nyawara

Brenda Nyawara is an editor at Archute. She is a graduate architect with a passion for edge-cutting ideas in design, fashion, art and modern world interests.
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Buying a home is a huge undertaking and responsibility. You have to think about the cost of the property, as well as additional expenses, such as property taxes and homeowners insurance.

Some people don’t think much of homeowners insurance, but it’s actually practical. For one thing, it helps protect your home. In fact, most policies cover replacement costs and both major and minor damage, such as damage caused by a tornado or a hurricane and fire.

Aside from protecting your property, homeowners insurance can offer coverage for your home's contents. So, you should take note of all the electronics, appliances, furniture, and other personal property that the policy would cover.

If you’re planning to get home insurance, check out the following factors to consider before buying a home:

1. Age And Condition Of The Home

When buying a home, a home inspection is always a good idea. This will help you identify any potential home problems that could cost you a lot of money later on. During an inspection, a qualified inspector will help you get the facts about the property to ensure you’re investing in the right home.

For example, there might be some asbestos or lead paint in the home, particularly if it was built before the '70s. Exposure to asbestos can lead to pulmonary diseases and cancer. Lead paint is dangerous to your health as well, especially for young children, since it can cause headaches, high blood pressure, and fatigue.

Therefore, it's advisable to determine the age and condition of your home before buying it, as this will significantly impact insurance costs.

2. Location 

Insurance providers will always consider the location of a property as an essential factor when working out premiums. This is because the location can affect how likely it is to be damaged or destroyed and also how expensive it would be to repair.

For example, a house in an area prone to flooding is likely to be more expensive to insure than one in a drier area. Similarly, a house in an earthquake zone will typically command higher premiums than one in a less seismically active area.

3. Value Of The Home And Personal Property

As mentioned earlier, home insurance safeguards your home and personal property from damage or loss due to unforeseen events, such as theft or severe weather. The coverage you need depends on your home's and personal property's value.

Hence, you need to figure out the value of your home and personal property when choosing a homeowners insurance policy. The value of your home is the amount it would cost to rebuild it if it were destroyed while the value of your personal property is the replacement cost of your possessions.

Home values can fluctuate over time, so you must review your policy to ensure you have adequate coverage. Personal property values can change too, so you should reassess your belongings to make sure they’re insured periodically.

4. Type Of Home

Some types of homes cost more to insure than others. For example, a brick home will typically cost less to insure than a wood-frame home. This is because brick homes are more resistant to fire and weather damage.

5. The Deductible

The deductible is the figure the policy holder must pay out of pocket before the insurance company makes payments. In other words, if you’ve got a USD$500 deductible and your home suffers USD$1,000 worth of damage, you’ll need to pay the first USD$500, and the insurance company will cover the remaining USD$500.

While a high deductible can lead to lower premiums, it also means that you’ll be responsible for a more considerable financial burden in the event of a claim. Thus, you need to take account of your needs and resources when deciding on a deductible.

6. Your Credit History

Although your credit history is one of the crucial things to understand about mortgage insurance, it's a critical factor in home insurance as well. Most insurance companies use credit-based insurance scores to determine premiums.

A good credit score can lead to lower premiums whereas a poor credit score could result in higher rates. So, if you want to buy a home, check your credit report and work on boosting the score before you start shopping for insurance.

Things You Didn’t Realise Could Invalidate Your Home Insurance after buying a home

While it’s particularly important to take out home insurance, it’s just as easy to accidentally invalidate it too. Some actions (or inactions) could either invalidate it completely or just remove coverage for certain particulars. To guide you in preventing this outcome, here are 4 things to avoid, which could invalidate your home insurance cover.

1. Building Works

When undertaking significant building works or a substantial renovation, it affects the building site of the insurance cover. Plaster dust being sprayed around or ceiling tiles falling could pose a risk to the insured contents too - this is relevant as well. Any major planned structural changes to the home should trigger a call to the current insurer to discuss it. Also, bear in mind that new extensions or upgrades can increase the home’s market value, so the amount of insurance cover probably will need to increase too.

2. Leaving The Property Unoccupied For Long Periods

Whether you have cheap home insurance or a more expensive type, the insurance covers the address,  but it doesn’t mean that there’s no limit to it. Going away and not returning for over 60 days is a cause for advising the insurer about your plans.

Why is this the case?

Because when there’s no one at home, there’s an increased likelihood of a burglary occurring. It’s also possible that a major water leak or another event could happen in your absence, causing building damage that would have been prevented or minimised if you’d been present. As such, it changes the parameters of the home and the risks too. Hence, the insurer must be told.

To get the best deal for home insurance even when you’re away a lot, you can find over 50 providers on this site. They get insurance quotes from scores of UK insurers to find the right policies for homeowners at the best price possible.

3. Pet Access Flaps

Dog flaps and cat flaps provide a way for a pet to enter and exit more easily. However, depending on the size of the animal, it might also provide a way to access the property to burglarise it too.

There’s also the possibility of internal property damage when it’s a flexible flap that can open from the sheer force of rain, hailstones, and the like. Potentially, this could cause some flooding in the home.

Insurers need to be informed about pre-existing or new flaps for pets to enter/exit at will. This only applies to some insurance policies, but it’s difficult to know which ones. So, check with the insurer either way if this might apply to your home.

4. Getting A Lodger

Taking on a lodger to help cover the mortgage is something that around three percent of UK households do.

It depends on the insurance company and the policy that you have, but having a tenant could breach the policy’s terms and conditions. You’ll need to call and check with them to be sure. It’s not a bad idea to have it noted on the policy in their records just to cover yourself too.


Home insurance is a vital part of the home-buying process. By considering all of these factors, you’ll get the best possible coverage for your needs.

When buying homeowners insurance, explore your options and compare rates from different companies. And remember, the cheapest policy isn't always the best—be sure to read the fine print and understand what you're buying before signing on the dotted line.

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About the author

Brenda Nyawara

Brenda Nyawara is an editor at Archute. She is a graduate architect with a passion for edge-cutting ideas in design, fashion, art and modern world interests.
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