Luxe Buyer’s Guide: Understanding Homeowners Insurance

When you're buying a home, there’s more to think about than square footage and countertops. One of the most important (yet often overlooked) parts of your journey is homeowners insurance — and at Luxe International Homes, we believe you deserve to be fully informed.

Let’s walk through the essentials together so you can feel confident, protected, and prepared.

💬 What Is Homeowners Insurance?

Homeowners insurance is protection — plain and simple. It covers you for unexpected losses to your home or property and may include:

• Rebuilding or repairing your home or detached structures (e.g., fences, sheds, garages)

• Replacing personal belongings

• Covering legal or medical expenses for accidents on your property

• Paying for temporary living expenses if you’re displaced due to a covered event

It’s more than a policy — it’s peace of mind when life takes an unexpected turn.

🔥 What Are Perils and What’s Covered?

A peril is an insurance term for a specific risk or cause of damage. Your insurance will only cover events (perils) listed in your policy. The most common type — called HO-3 or “Special Form” — typically covers:

• Fire, hail, or lightning

• Freezing pipes

• Theft or vandalism

However, floods and earthquakes are often not included and may require additional coverage.

At Luxe, we’ll help you ask the right questions to ensure you’re covered where it counts.

🏦 Is Homeowners Insurance Required?

Yes — if you’re using a mortgage to buy your home, your lender will require insurance for the life of your loan. If you’ve paid cash or paid off your mortgage, insurance is optional, but still highly recommended.

Protecting what you’ve worked so hard for is a no-brainer — and Luxe makes sure you understand every detail.

💵 How Much Does It Cost — and How Do I Pay?

Premiums vary based on:

• Location

• Age and size of your home

• Condition and construction of the property

• Risk level (e.g., flood zones, roof type)

You can usually pay:

• Monthly

• Quarterly

• Annually

Some lenders roll the cost into your monthly mortgage payment and pay it from an escrow account on your behalf.

💰 How Much Will My Insurance Pay?

There are two main types of reimbursement:

1. Replacement Cost Value (RCV)

This pays to replace or rebuild your home/property using similar materials — not what you paid for it, but what it costs today.

Example: If your home is insured for $500,000 and rebuilding costs $375,000, you may receive $300,000 after your deductible — assuming you meet the coverage requirement (usually 80% of replacement cost).

2. Actual Cash Value (ACV)

This factors in depreciation. You get what the item is worth today, not what you originally paid.

Example: If a table you bought for $1,500 is now worth $750, your policy pays $750 — unless you purchase additional coverage.

Some policies also offer extended replacement cost, covering up to 120% of your policy limit — which can be crucial if construction costs rise.

At Luxe, we connect you with trusted insurance agents who walk you through these options.

🧾 Are Homeowners Insurance Premiums Tax Deductible?

For your primary residence, homeowners insurance is typically not tax deductible.
However:

• If you run a business from your home

• Or rent out the property

You may be eligible for deductions.
Also, losses from presidentially declared disasters may qualify for a casualty loss deduction.

Always consult your tax advisor for your unique situation.

🏡 Luxe Guidance That Covers More Than Property

At Luxe International Homes, we believe in equipping you with more than keys — we equip you with knowledge, confidence, and support. That includes helping you understand how to protect your new investment from day one.

We’ll connect you with vetted, licensed insurance professionals and walk with you through every step — because this is more than real estate. It’s about faith, legacy, and informed ownership.

📞 Let’s Talk About Protecting Your Future

Ready to learn more about preparing for homeownership the right way?

✅ Call Lauren Catchings: 229-304-5893
🌐 Visit: www.luxehp.com
📩 DM us to ask about our Luxe Buyer Protection Checklist