When you buy a home, you also need to sign up for homeowner's insurance.
Most mortgage companies will not give you a mortgage (and allow you to close on your new home) until you show proof of coverage.
Usually you need to insure at least the value of the home.
The first step in figuring out how much homeowner's insurance coverage you need is to figure out the value of your home.
Most likely this was already done in the process of arranging for your mortgage since the mortgage company usually wants to make sure that you are not paying too much money for your home.
You will need to find out what the house was appraised for since the insurance company will need to know this to help you determine the coverage that you need.
You will need to figure out which type of coverage you want as well.
Usually these policies cover at least the current value of your home, but many policies will cover a certain percentage over this amount in order to make the policy one with replacement coverage.
If you are comparing different policies, make sure you are comparing those with identical replacement coverage amounts.
Another important factor in determining the amount of homeowners insurance that you need is the amount of liability coverage that you would like to have.
This covers you in case someone is injured while at your house.
This is especially important if you have a pool or trampoline or anything else that might increase the danger to others visiting your home.
Finally, there are a number of other types of additional coverage you might want or need.
These include extra coverage in case of floods or earthquakes, coverage for personal property that you might have inside the house (especially if you have items like expensive jewelry or furs), coverage for other structures on the property (like sheds or fences), and loss of use coverage (which would give you money to live somewhere else while your home is being repaired).
Once you have figured out how much of each type of coverage you would like, if any, you will know the total amount of coverage you need.
Then the insurance agency can calculate the premiums that you would need to pay in order to have that amount of insurance.
Be sure to get quotes from a number of different companies so you can get the best rate available.