Insurance Must-Knows for Homeowners: What to Know Before and After Closing
Home insurance isn’t the most exciting part of homeownership — but it’s one of the most important. Whether you’re buying your first home or reviewing your current policy, understanding what your insurance covers (and what it doesn’t) can save you major headaches and expenses down the road.
Let’s start with what you need to know before closing.
If you’re purchasing a home, your lender will require you to have a homeowner’s insurance policy in place before closing day. This ensures that the property — and the lender’s investment — are protected from day one. It’s best to start shopping for insurance at least two weeks before closing so you have time to compare coverage, rates, and policy options.
Here’s another important detail: most insurance companies require you to pay for one full year of coverage upfront at closing. This is called prepaid insurance and it’s included in your closing costs. Once that year is paid, your lender will usually collect small monthly portions of your renewal premium as part of your escrow payment, so coverage continues automatically.
After your policy is in place, here are a few things every homeowner should know:
1. Know what’s actually covered. Standard policies typically protect your home’s structure, your belongings, and provide liability coverage — but make sure your limits are high enough to rebuild or replace everything in the event of major damage.
2. Understand your deductible. Your deductible is what you pay out of pocket before insurance steps in. Choosing the right amount is about balancing your comfort level and your monthly premium.
3. Replacement cost vs. actual cash value. Replacement cost covers the full cost to rebuild or replace items at today’s prices, while actual cash value factors in depreciation. Replacement cost is often worth the slightly higher premium.
4. Ask about add-ons like flood or sewer backup coverage. Standard homeowner’s insurance doesn’t include these — and they can be lifesavers if disaster strikes.
5. Review your policy every year. Renovations, new furniture, or even updated building codes can impact your coverage needs. Make sure your policy keeps up with your home’s value.
Homeowner’s insurance isn’t just a closing requirement — it’s your safety net for one of your biggest investments. Understanding what’s required upfront and how to manage your policy afterward gives you confidence, security, and true peace of mind.
Final thought from Katy:
Your home deserves to be protected the right way. If you’re getting ready to buy or just want to make sure your current coverage fits your needs, reach out. I can connect you with trusted local insurance professionals and help you understand exactly what’s required before closing — and how to stay protected long after.
Helping Columbus and Delaware homeowners make smart moves, one home at a time.
Contact Katy or schedule an appointment
Katy Jones
Coldwell Banker Realty
614-572-6362
Katy.Jones@CBRealty.com
www.BuySellLoveColumbusOhio.com