• Carbone Insurance Service

Buying or Selling a Home: How it impacts your insurance

Putting your house up for sale, packing and moving to your new dream home can be a lot of work! Among all the other tasks on your list, you should be in contact with your home insurance agent as soon as possible for guidance on when it's best to cancel your current policy and for help setting up the new home's insurance policy.

Here are the top 5 things to keep in mind when buying or selling a home:

1.) Be prepared...buyers who finance a mortgage typically must secure and pay a premium of homeowners insurance prior to closing. The title company may delay the closing if proof of coverage is not presented.

2.) Since your homeowners insurance policy is specific to the home in which you live, it will not transfer to a new home once you sell your old home. It also will not transfer to the new owners, as they will have different coverage needs.

3.) It is important to thoroughly review and comparison shop for your new home's coverage. While you may have had the best premium for the home in which you lived, moving to a new home will likely mean a new street location and home size. These factors, and more (see #4), will affect the premium and amount of coverage needed. There may be another carrier that is more suited to insure your new home. Shopping around will help you obtain the best coverage at the best price.

4.) Every little detail of the home goes into consideration when determining the cost of homeowners insurance. Your new home may have features that qualify for discounts such as security systems. Some of the main rating factors include:

  • The age of the home

  • Appraisal value

  • The size of the home

  • The physical location of the home

  • Proximity to fire hydrants and nearest fire department

  • The cost to repair or rebuild the home

  • Previous repairs, such as a new roof or upgrades to plumbing and electric

5.) If you move your personal possessions out and turn off the utilities to your current home before it sells, this home is now considered vacant. Each insurer has their own rules on how long a house can be unoccupied before they will cancel the homeowners insurance. Some carriers allow a special endorsement to be added; while others require an entirely new vacant home insurance policy. Why would insurers do this? Because an empty residence is a much higher risk for damage.

Buying or selling a home is not a time for surprises! Contact your agent as soon as possible for guidance!

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