--- title: Insurance Questions First-Time Home Buyers Should Ask Before Closing description: Essential insurance questions first-time home buyers should ask before closing to ensure adequate coverage and avoid costly surprises. image: https://blog.concklin.com/hubfs/Insurance%20Questions%20First-Time%20Home%20Buyers%20Should%20Ask%20Before%20Closing.png --- [Skip to content](https://blog.concklin.com/insurance-questions-first-time-home-buyers-should-ask-before-closing#main-content) [facebook-f icon](https://www.facebook.com/ConcklinInsurance) [linkedin-in icon](https://www.linkedin.com/company/concklin-insurance-agency) [Twitter icon](https://twitter.com/ConcklinA) [youtube icon](https://www.youtube.com/channel/UC_HnJQ4S_USSxBJkauXwu6A) [**Contact Our Team **](https://insurance.concklin.com/compare-quotes#CLQuoteRequest) **[630-268-1600](tel:+16302681600)** **[Contact Our Team](https://insurance.concklin.com/compare-quotes#CLQuoteRequest)** ****[630-268-1600](tel:+16302681600)**** [![Concklin Logo-1](https://blog.concklin.com/hs-fs/hubfs/Concklin%20Logo-1.png?width=314&height=100&name=Concklin%20Logo-1.png)](https://insurance.concklin.com/) - About Us Show submenu for About Us - [Our Story](https://insurance.concklin.com/about-us-who-we-are) - [Our Team](https://insurance.concklin.com/meet-our-team) - [Contact Us](https://insurance.concklin.com/contact-us) - [Markets & Industries](https://insurance.concklin.com/industry-specific-insurance-programs) - [Business Insurance](https://insurance.concklin.com/business-insurance-coverage) - [Personal Insurance](https://insurance.concklin.com/personal-lines-insurance-coverage) - Life & Health Insurance Show submenu for Life & Health Insurance - [Life Insurance](https://insurance.concklin.com/life-insurance) - [Health Insurance](https://insurance.concklin.com/health-insurance) - Resources Show submenu for Resources - [Claims Resources](https://insurance.concklin.com/claims-resources) - [Cyber Resources](https://insurance.concklin.com/cyber-insurance-resources) - [Blog](https://blog.concklin.com/) - [Video Library](https://blog.concklin.com/video-library) - [Client Portal](https://insurance.concklin.com/client-portal) - [Make A Payment](https://concklin.appliedpay.com/) Open main navigation Close main navigation - About Us Show submenu for About Us - [Our Story](https://insurance.concklin.com/about-us-who-we-are) - [Our Team](https://insurance.concklin.com/meet-our-team) - [Contact Us](https://insurance.concklin.com/contact-us) - [Markets & Industries](https://insurance.concklin.com/industry-specific-insurance-programs) - [Business Insurance](https://insurance.concklin.com/business-insurance-coverage) - [Personal Insurance](https://insurance.concklin.com/personal-lines-insurance-coverage) - Life & Health Insurance Show submenu for Life & Health Insurance - [Life Insurance](https://insurance.concklin.com/life-insurance) - [Health Insurance](https://insurance.concklin.com/health-insurance) - Resources Show submenu for Resources - [Claims Resources](https://insurance.concklin.com/claims-resources) - [Cyber Resources](https://insurance.concklin.com/cyber-insurance-resources) - [Blog](https://blog.concklin.com/) - [Video Library](https://blog.concklin.com/video-library) - [Client Portal](https://insurance.concklin.com/client-portal) - [Make A Payment](https://concklin.appliedpay.com/) --- Jul 8, 2026, 10:14:59 AM # Insurance Questions First-Time Home Buyers Should Ask Before Closing ![Picture of Amanda Yaniz](https://blog.concklin.com/hs-fs/hubfs/Amanda%20Yaniz.jpeg?width=50&name=Amanda%20Yaniz.jpeg) [Amanda Yaniz](https://blog.concklin.com/author/amanda-yaniz) Share: [facebook-f icon](http://www.facebook.com/share.php?u=https://blog.concklin.com/insurance-questions-first-time-home-buyers-should-ask-before-closing) [linkedin-in icon](http://www.linkedin.com/shareArticle?mini=true&url=https://blog.concklin.com/insurance-questions-first-time-home-buyers-should-ask-before-closing) [Twitter icon](https://twitter.com/intent/tweet?url=https://blog.concklin.com/insurance-questions-first-time-home-buyers-should-ask-before-closing) [envelope icon](mailto:?body=https://blog.concklin.com/insurance-questions-first-time-home-buyers-should-ask-before-closing) Insurance Questions First-Time Home Buyers Should Ask Before Closing 7:39 Buying your first home comes with a long list of requirements. Mortgage approval, inspections, closing costs, taxes, escrow, and homeowners’ insurance are all part of the process. One common mistake first-time home buyers make is treating insurance accepted by the lender as the same thing as the right insurance policy for the homeowner. The lender's insurance requirement is designed to protect the mortgage interest in the property. It is not a complete review of whether the policy is the best fit for you. Recent Fannie Mae and Freddie Mac updates give lenders more flexibility on certain property insurance requirements, including roof coverage. That flexibility may help some buyers meet mortgage requirements, but it also makes it more important to understand how the policy would respond after a claim. Before choosing a policy, you should understand the coverage terms, deductibles, exclusions, and claim settlement details. ## How Lender Requirements Affect the Insurance Review Fannie Mae and Freddie Mac do not sell homeowners insurance. They buy and guarantee many mortgages in the secondary mortgage market, so their insurance requirements influence what lenders accept when you get a conventional mortgage. When those requirements change, lenders may be able to accept policies with different coverage terms than they accepted before. A policy can satisfy the lender and still leave you with more out-of-pocket responsibility than expected, depending on how the coverage is written. ## Replacement Cost vs. Actual Cash Value Some property coverage is written on a replacement cost basis. Other coverage is written on an actual cash value basis. Replacement cost coverage generally pays based on the cost to repair or replace damaged property with similar new property, minus the deductible and subject to the policy terms. Actual cash value coverage subtracts depreciation. Older property is valued for less than new property. After a covered claim, actual cash value settlement can leave you responsible for more of the repair or replacement cost. This difference is especially important when reviewing roof coverage. ## Roof Coverage Needs Extra Attention Ask whether the roof is covered on a replacement cost or actual cash value basis. Roof coverage may be handled differently than the rest of the home. For example, if a covered storm damages a 15-year-old roof, an actual cash value policy pays the depreciated value of that roof. You would be responsible for the deductible and the difference between the insurance payment and the cost to replace the roof. Some policies may include separate roof schedules, wind and hail deductibles, cosmetic damage exclusions, or age-based limitations. Before closing, you should know whether any roof-specific terms apply, which deductible would apply after a covered claim, and whether the age or material of the roof changes how the claim would be paid. Ask: - Is the roof covered for replacement cost or actual cash value? - Is there a separate wind or hail deductible? - Are there cosmetic damage limitations? - Does the policy treat the roof differently because of age or material? - Would the current roof condition create underwriting issues after closing? ## Personal Property Coverage Should Also Be Reviewed Personal property coverage protects belongings such as furniture, clothing, electronics, appliances, and other household items. Confirm whether your belongings are covered for replacement cost or actual cash value. After a fire, theft, or water damage claim, actual cash value coverage may not provide enough money to replace what was lost. You should also ask whether valuable items, such as jewelry, collectibles, musical instruments, home-based business property, or certain electronics, have special limits. Some items may need to be scheduled separately or insured with additional coverage. ## Water Damage Can Be Handled in Different Ways Water damage can be one of the most misunderstood parts of a homeowner’s policy. Homeowners’ policy can treat different types of water damage in different ways. A burst pipe, sewer backup, sump pump overflow, seepage, groundwater, and flood may all be handled differently. Some water losses may be covered. Others may be limited, excluded, or require separate coverage. Flood insurance is separate from homeowners’ insurance. A home does not need to be in a high-risk flood zone to have a flood exposure. Heavy rain, poor drainage, rapid snowmelt, and nearby development can all create water problems. Before closing, review how the policy handles: - Water or sewer backup - Sump pump overflow - Flood - Seepage or groundwater - Water damage deductibles or sublimits ## Condo Buyers Should Review the Master Policy If you are buying a condo, the association carries a master insurance policy for the building or common elements. You still need your own policy for interior improvements, personal property, liability, loss assessment, and any portion of the unit not covered by the master policy. Master policies are not all written the same way. Some cover more of the unit interior. Some cover less. Some have large per-unit deductibles. Some leave responsibility for improvements, betterments, fixtures, or interior finishes to the unit owner. Review the association's insurance documents before closing. You need to know where the association's coverage ends and where your responsibility begins. If you are buying a condo, ask about: - The association master policy deductible - Whether the master policy covers the interior of the unit - What improvements or upgrades are your responsibility - Whether your unit owner policy needs building property coverage - Loss assessment coverage - Water damage limitations ## Liability Coverage Should Not Be Overlooked Homeowners’ insurance also includes personal liability coverage. This can help if someone is injured on the property or if you are responsible for certain types of accidental damage to someone else's property. Review the liability limit, medical payments coverage, and whether an umbrella policy should be considered. This can be especially important if you have pets, a pool, frequent guests, young drivers in the household, or other exposures that could increase the chance of a liability claim. ## What You Should Ask Before Closing Before choosing a homeowners insurance policy, ask: - Does this policy only satisfy the lender, or have the coverage limitations, deductibles, and claim settlement terms been reviewed with me? - Is the roof insured on a replacement cost or actual cash value basis? - Are there separate deductibles for wind, hail, hurricanes, or named storms? - Is personal property covered on a replacement cost basis? - How does the policy handle water or sewer backup, sump pump overflow, and flood? - Are there exclusions or limitations based on the age, condition, or materials of the home? - What liability limit is included? - Should an umbrella policy be considered? - For a condo, what does the association master policy cover, and what am I responsible for insuring? Getting insurance approved by the lender is only one step. Before closing, you should understand how the policy handles the home, roof, belongings, water damage, liability, deductibles, exclusions, and condo responsibilities. If you are buying your first home and have questions about homeowners’ insurance, Concklin Insurance Agency is happy to help you review your options before closing. 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