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First-Time Homebuyer’s Guide to Essential Home Insurance Coverage

Wells Insurance

Buying your first home is a huge milestone, equal parts exciting and overwhelming. Between signing paperwork, budgeting for furniture, and learning how to mow the lawn just right, home insurance probably isn’t the most thrilling part of the process. But here’s the truth: it’s one of the most important investments you’ll make to protect your new home (and your wallet).

If you’re wondering what kind of coverage you actually need, and what’s just “nice to have,” this guide breaks it down in plain English.

Why Home Insurance Matters (Even If You’re Not Required to Have It)

If you’re taking out a mortgage, your lender will almost certainly require you to carry home insurance. But even if you own your home outright, insurance is what stands between you and massive financial loss if something goes wrong.

Think about it...if a fire, hurricane, or burst pipe caused serious damage tomorrow, could you afford to rebuild or replace everything on your own? Probably not. That’s where essential home insurance coverage steps in.

The Must-Have Coverages Every Homeowner Needs

1. Dwelling Coverage

This is the backbone of your policy. It covers the cost to repair or rebuild your home’s structure if it’s damaged by covered perils like fire, wind, hail, or vandalism.
Tip: Make sure the coverage amount matches the rebuild cost of your home, not its market value. Construction costs often rise faster than home prices.

2. Personal Property Coverage

This protects what’s inside your home — furniture, clothing, electronics, and personal belongings. If a storm or break-in damages or destroys your stuff, this coverage helps replace it.
Pro Tip: Take inventory of your belongings using photos or an app before you move in. It makes filing a claim much easier later.

3. Additional Living Expenses (ALE)

If your home becomes unlivable after a covered event, ALE pays for temporary living costs — think hotel stays, meals, or renting another space while repairs are made.

4.Liability Protection

If someone is injured on your property or you accidentally cause damage to someone else’s property, liability coverage protects you from expensive lawsuits or medical bills.
Even if you’re a careful homeowner, accidents happen. This coverage gives you peace of mind knowing one slip on your front steps won’t derail your finances.

5. Wind and Hail Coverage (Especially for Coastal Buyers)

If you’re buying near the coast, standard home insurance may exclude wind or hail damage. In that case, you’ll need a separate wind policy or a state wind pool policy to stay fully protected.
If you’re moving to the North Carolina coast, check whether your new home is in a Tier 1 or Tier 2 coastal area. That determines how wind and hail coverage is provided and what your deductible may look like.

6. Other Structures

This is coverage for any structure on the property that is not physically connected to the home. It would include storage sheds, in-law suits, pool house, hardscapes, etc

Common Coverage Gaps First-Time Buyers Overlook

Flood Insurance: Standard policies don’t cover flooding from heavy rain, hurricanes, or storm surge. You’ll need a separate flood policy through the National Flood Insurance Program (NFIP) or a private carrier.
High-Value Items: Jewelry, art, and collectibles often have limited coverage. You can add a scheduled personal property endorsement for full protection. You can also look into High Net-Worth Insurance.
Deductible Confusion: Many new homeowners choose low deductibles without realizing how much that raises their premium. It’s about balance. Pick a deductible that fits your emergency fund.

How to Save on Your Home Insurance Without Cutting Corners

Bundle your home and auto policies for a discount.
Install smart home devices like smoke detectors, security cameras, or water leak sensors.
Keep your credit score healthy — it can influence your rate.
Ask about first-time homeowner discounts — some insurers reward responsible new buyers.

Final Thoughts: Protect Your First Home the Right Way

Buying your first home is a big step, but navigating your insurance coverage doesn’t have to be confusing. With the right protection in place, you can focus on making your new house feel like home — without worrying about what happens if disaster strikes.

👉 Ready to make sure your home is fully protected?
Contact Wells Insurance today for a quick, personalized coverage review that fits your lifestyle and your budget.