If you are selling your house, you are probably busy with packing, cleaning, showing the home, and finding a new place to live. However, you should take some time to make sure your insurance company and policy is updated with your plans. Here are some steps you need to take with your home insurance as you go through the process of your home sale.
1. Call and explain you are planning on selling your home.
First, when you have the intention of selling, you might pay a quick call to your insurance agent to let them know. This should not affect your rates at all, but with the note of possible sale on your account, it won't be any hassle later when you need to call to change or cancel your policy. Some policies can also be transferred, so if you already have a new house lined up, your insurer can get started assessing the other property for new rates.
2. Make sure you change or update your policy if you need to leave the property vacant.
If you are living in the home, your insurance policy covers you and your home just like normal. However, some people have to move out before the house sells, which leaves the property vacant. Check your policy for how vacancy affects your coverage. Vacant homes are higher risk because people aren't there to catch things like plumbing leaks or fires, so the damage can be more extensive. Your insurance might only be valid for a vacant home after a certain number of days, such as 15 or 30. You would need to update your policy to cover damages that happen when the home is empty, which might temporarily increase your rates.
3. After the sale, make sure the policy is fully canceled.
After the sale has gone through, you need to contact your insurance agent again to make sure your policy is canceled. Sometimes, you pay the lump sum of your insurance at the beginning of the year, or the insurance is paid by your loan broker through escrow. If this is the case, canceling your policy would mean you get a refund for the months you paid for but did not need because you no longer own the home. You can put that money toward a new policy or toward the costs of buying or renting your new home.
For more information, contact your local insurance company, like Ideal Insurance Agency.