\u201cBetter call up my insurance buddy Joe to check on my homeowners policy!\u201d<\/p>\n
You laugh now, just make sure you\u2019re not crying later. The average American has 68% of their total wealth <\/i>tied up in their home, and anyone who\u2019s ever dealt with claims knows that companies will find any loophole to avoid paying out. Was your house vacant at the time it got vandalized during your home sale? Did you cancel the policy a week before the storm of the century hit your town due to a closing mixup?<\/p>\n
Say it with us now: Coverage…denied.<\/i><\/p>\n
Who better to explain exactly what you need to do than an insurance agent with 12 years of experience (meet Grant Sims<\/a> of Greenville, South Carolina) and a top real estate agent who knows what you\u2019re going through on the sell side.<\/p>\n Follow their advice and you can make this whole insurance transfer business a simple check-off on your to-do list.<\/p>\n We\u2019ve made it easy by breaking it down into a list of the main things you want your insurance agent to know when selling your house:<\/p>\n It\u2019s a good idea to let your homeowners insurance agent know<\/a> you\u2019re planning to move in the next few months. This gives your agent plenty of time to look up policy options for the new home you\u2019ll be moving into, and allows you time to compare options and rates.<\/p>\n And this applies even if you haven\u2019t picked out another house yet. If you just know the neighborhood or area you\u2019re planning on moving to, your insurance agent can look into whether you\u2019ll need add-ons (like flood insurance, for example, if you\u2019re moving into a flood plain), and give you a rough estimate of what to expect your yearly insurance costs to be moving forward.<\/p>\n If you\u2019ll be moving out of your home before it closes, leaving it vacant, you\u2019ll need to check with your agent about the company\u2019s policy regarding vacant homes.<\/p>\n Many insurance providers are less inclined to insure vacant homes<\/a> than occupied ones, simply because it\u2019s a lot easier for something like theft or vandalism to occur when a home is unoccupied.<\/p>\n \u201cSome companies require you to tell them immediately, while others will cover it just the same for up to six months,\u201d Sims says.<\/p>\n \u201cSo you need to contact your agent right away and find out what your company mandates. Because let\u2019s say you have a claim in 30 days, but you didn\u2019t tell the company the home was vacant. They\u2019ll say, \u2018Well, you didn\u2019t tell us, so you\u2019re not covered.\u2019\u201d<\/p>\n According to Sims, the moving process is the perfect time to take inventory of your belongings<\/a>, which will help you see whether you\u2019ve got the right amount of insurance coverage going into your new home or if you need to bump up your policy. This is especially true if you\u2019ve got items of value, like jewelry, a grand piano, or expensive artwork in the mix.<\/p>\n Most companies require you to itemize belongings that are over a certain value in order for them to be covered under your homeowners policy.<\/p>\n \u201cNobody wants to pay more for a policy, but the worst thing is to have to say, \u2018I had this [valuable item] stolen,\u2019 and the company to say, \u2018You didn\u2019t itemize, so it\u2019s not covered.\u2019 Most companies don\u2019t require anything formal, though some do. So you should always check with your agent about what\u2019s required.\u201d<\/p><\/blockquote>\n Sometimes the listing process turns up issues that you have to address for your potential buyer\u2019s<\/i> insurance purposes\u2014even if you had no trouble getting insurance for your home when you purchased it.<\/p>\n For example, maybe your home has polybutylene piping<\/a>\u2014a problematic type of plumbing that many insurers no longer cover<\/a>. Perhaps it was grandfathered in under the policy you purchased years ago but will pose a serious issue to the buyer who\u2019s trying to get a new policy.<\/p>\n Another example, says Jim Geracie<\/a>, a top performing real estate agent in Milwaukee area<\/a>, is a property with an old fuse system.<\/p>\n \u201cI will classically say to my seller clients, \u2018I know you\u2019ve had coverage, but a buyer going out in 2019 to try and find coverage for these fuses is going to run into a brick wall,\u2019\u201d explains Geracie. \u201cHence we\u2019re probably going to have to replace these electric panels to make sure that a buyer can get insurance and therefore financing.\u201d<\/p>\n Once your home is actually under contract, let your homeowners insurance agent know your expected closing date.<\/p>\n If you\u2019re transferring your policy<\/a> to your new home, this is the point at which your agent will notify your current carrier that you\u2019ll be moving, give them your new address, and obtain any additional information they need about your new property in order to complete the transfer.<\/p>\n Keep in mind that transferring a policy doesn\u2019t actually mean you\u2019re keeping the same policy. Each homeowners insurance policy is unique to the home it\u2019s insuring, so your rate could go down or up depending on factors like the crime rate in your new neighborhood, the age of your new home, the age of your roof, location in a floodplain, etc.<\/p>\n According to Sims, there\u2019s no reason to ask your insurance agent to cancel your policy until you\u2019ve signed the closing paperwork. In fact, doing so could result in a coverage gap or require you to keep calling back to make adjustments.<\/p>\n \u201cClosing dates change all the time, which could mean you have to cancel and rewrite the policy each time it changes,\u201d Sims says. \u201cIf it were me selling my house, when I left closing I\u2019d call my agent and say, \u2018Cancel my policy.\u2019 The cancellation process is pretty immediate.\u201d<\/p>\n Bottom line is… you don\u2019t want to cancel your policy until the house is no longer yours<\/a>. This will prevent the possibility that you\u2019re left without coverage because a closing date is moved out by a few weeks or a month.<\/p>\n For example, if you ask your agent to cancel the policy on June 25, but on June 24 the financing gets held up and closing is pushed out until July 10, you\u2019ve got two weeks that your home would be sitting uninsured.<\/p>\n If a claim happened during that time, covering the damages would come out of your pocket, and if it\u2019s something major\u2014a tree falling on the home, for example\u2014it could derail your sale entirely.<\/p>\n As you\u2019re tidying up, decluttering, and downsizing your home to get it ready to list, you should also take a look at your homeowners insurance policy to see exactly what is covered.<\/p>\n For example, if something is broken during the moving process, would your policy cover the damages? You\u2019d think that because the belongings are insured when they\u2019re in your home, they should be insured whether or not they\u2019re in a moving truck.<\/p>\n However, this is only true if you have what\u2019s called an \u201copen perils\u201d policy<\/a> (also known as an \u201call perils<\/a>\u201d policy).<\/p>\n In this type of policy, coverage is provided for anything other than what is specifically excluded, and when it comes to the claims process, the burden of proof is on the insurance company. In other words, if you submitted a claim and they wanted to dispute it, they would have to prove that the situation leading to the claim was specifically excluded from the policy.<\/p>\n![\"A](\"https:\/\/www.homelight.com\/blog\/wp-content\/uploads\/2019\/06\/insurance-agent-box.jpg\")
<\/a>1. Your moving plans<\/h2>\n
2. If your house is going to be vacant for any period of time<\/h2>\n
![\"A](\"https:\/\/www.homelight.com\/blog\/wp-content\/uploads\/2019\/06\/insurance-agent-piano.jpg\")
<\/a>3. Extra coverage needs for the future<\/h2>\n
4. Any dated home features that will be hard for buyers to insure for<\/h2>\n
5. Your expected closing date<\/h2>\n
![\"Closing](\"https:\/\/www.homelight.com\/blog\/wp-content\/uploads\/2019\/06\/insurance-agent-paperwork.jpg\")
<\/a>6. Your actual closing date<\/h2>\n
7. Moving protections<\/h2>\n