Home owners vs. renters insurance?

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Should I keep my renters insurance? Im buying a home next year and will be getting home owners and flood insurance. What is the difference between the renters and home owners insurance??

I live in Texas btw…should I also get Earth quake insurance also?

  1. Reply
    June 26, 2011 at 9:57 am

    Renters insurance only covers the loss of your personal items. Homeowners insurance covers that PLUS the loss of the home itself. When you buy a house, you are required by the lender to carry homeowner’s insurance.

    I am in Texas also, and I’m not aware of any earthquakes in Texas. Nobody in Austin carries earthquake insurance.

  2. Reply
    June 26, 2011 at 10:09 am

    Flood insurance is pretty expensive — try to avoid buying a house in a floodplain.

    The biggest difference is in liability — homeowners & landlords are at risk for liability if someone is hurt on their property — and coverage of the dwelling itself.

    A good idea is to stick with your same insurance agency you now have, if you are happy with them.

  3. Reply
    June 26, 2011 at 10:17 am

    you cannot keep both. your either a renter or an owner. once you purchase your home you need a homeowners policy. do you have a lot of earthquakes in TX? 🙂 probably don’t need that. make sure your home is insured with replacement cost on the home and your contents. you are smart to take out a flood policy as well since a homeowners policy does NOT cover flood and most flood claims are actually made in a no flood plain. do your research and make sure you insure through a good company as your home is your biggest investment. make sure you carry a good amount of liability insurance (I recommend at least 500,000). its inexpensive on the policy and people are very sue happy these days. if you put your home where your auto is, you should get a nice discount on both policies.

  4. Reply
    June 26, 2011 at 11:07 am

    I wouldn’t keep the renters, it duplicates four coverages on the homeowners policy. Homeowners and renters policies both have Contents coverage, Loss of use coverage, Medical Payments coverage (to someone else, not household members), and Personal Liability. IN addition to those, a homeowners policy ALSO has Dwelling coverage (building) and Other Structures coverage.

    I’m in Texas. I don’t carry earthquake. If you want to, it’s up to you. I don’t carry flood, either, though, and we’re MUCH more likely to have a flood than an earthquake, IMO. If the money isn’t an issue, and you’ll sleep better at night for carrying earthquake, carry it.

  5. Reply
    Bradley S
    June 26, 2011 at 11:44 am

    You should seriously consider earthquake insurance. According to the United States Geological Survey, Texas has had 3 earthquakes strong enough to be felt in the past three years. One of the most powerful earthquakes in the nation’s history occurred on the New Madrid fault line in the Mississippi Valley in 1812. The chances of a major earthquake may be small, but the risks to your finances are huge. Should your home be badly damaged, your home value will go down, meaning you will not have home equity to draw on to pay for repairing or rebuilding yoru home. Your regular homeowners insurance will not pay for earthquake damage to the structure or belongings due to shaking (but will pay for fire damage and water damage from burst pipes).

    To find insurance that meets your needs, contact an insurance broker. A broker works with several companies and often handles several kinds of insurance. To find one in your area, log onto a site like http://www.homeownerswiz.com and complete the online form. Your information will be sent to a broker who will contact you. Good luck!

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