A Guide for First-time Home Buyers in MassachusettsThe New England region is an area known for its distinguishing architecture, from the Georgian style house to the Victorian home and its Colonial predecessor. In fact, homeowners policy serves as a safeguard for Massachusetts residents. A robust insurance policy protects life’s most precious possessions -- family and the biggest asset in one’s portfolio, a home. Whether it's a single family, town-home, condominium or an apartment, homeowners insurance not only covers damage to your property and your family, but also protects guests and your personal belongings.
1.Who Buys Homeowners Insurance?Homeowners insurance is a type of policy required for buyers when they are purchasing a home using mortgage loans. Mortgage lender protect themselves by requiring buyers to insure their homes with a homeowners policy. Often, these policies are overlooked by first-time home buyers, because they are trying to find ways to save money when you buy your first home. The right approach should be to find insurance that will protect your investment as well as your personal belongings while saving money
2. What Does a Homeowners Policy Serve?Homeowners insurance is a multi line policy that provides property and liability coverage in a single package. The homeowners insurance package ensures that there are no gaps and overlapping in your coverage. Here is a list of six property damages that homeowners insurance covers:
- HO 2 -- Broad Form; Owners Occupant: The term “Broad Form” refers to a policy that extends beyond the basic insurance coverage in cases of rare events or perils. Owner Occupant is a term that refers to the person who holds the title of the property and is also the property’s residents.
- HO 3 -- Special Form; Owners Form: A “Special Form” or also referred to as “Causes of Loss” which refers to a special type of policy that covers losses that are caused by any peril except those that are specifically excluded from the policy.
- HO 4 -- Tenants: “Tenants” or also called “Renters” is a person or a group of people that lives in place owned by someone else.
- HO 5 -- Comprehensive Form; Owner Occupant: In comparison to Broad Form that is mentioned above, a “Comprehensive Form” provides insurance in return for the premium and compliance of a policy. The Broad Form and a Comprehensive Form are the two main types of forms of homeowners insurance policies.
- HO 6 -- Condominium Owners: The term “Condominium Owners” refers to a building or unit being owned by a condominium association and managed professionally.
- HO 8 -- Modified Form: The “Modified Form” refers to a policy that provides coverage to basic named perils, property damage, liability coverage and medical expenses, but has limited insurance due to replacement cost exceeding the market value.