What to Look for When Choosing a Home Insurance Provider

If you own a house, that represents a pretty big investment – which is why it makes sense to get that investment insured. Home insurance isn’t required by law the way car insurance is, but a lot of people still have it; after all, an ounce of prevention is worth a pound of cure. Even though home insurance has an average cost of $1,383 annually for $250,000 in dwelling coverage, the cost of potential repairs or replacements is often difficult to cover out-of-pocket. Events like fire, flooding, or even an overgrowth of black mold are bad enough on their own; without a home insurance policy to cover some or all of the damages, the situation would be even harder to come back from.

What’s the first step in getting home insurance, you might ask? You’ll need to get in touch with a few different home insurance agencies, just to know what the options are. Once you have an idea of what’s being offered in your area, it’s time to discuss the details of your policy with Brad Siok State Farm Agent, a provider you trust. How can you know that you’ve chosen the right home insurance company, though? Below you’ll find five tips to help you make the best decision.

Compare the coverage against the quotes

When a home insurance company formulates a quote, they consider many different factors. If you’re looking at pricing from multiple companies, however, you can’t just assume that the cheapest one is the best deal; you also have to consider what’s included in each quote. Some providers will give you better deals than others, but you still basically get what you pay for. The quoted rates could also go up significantly if you want certain coverages on the policy, such as a replacement cost value policy, home sharing coverage, or flood insurance.

Don’t forget to ask about discounts too; for example, you might be able to combine your home and auto insurance policies to get a multi-policy discount. Some companies may also knock a bit off your bill if you pay the annual premium in full, if you don’t have any recent insurance claims, or if you install a home security system or water softeners.

Consider your experience with the insurance agency

While any home insurance provider should take good care of their policyholders, that isn’t all you should think about when considering how you prefer to interact with the company.

  • Ratings and reviews – The insurance company might talk themselves up, but what do their customers say? A reliable home insurance provider will handle claims responsibly, take care of settlements in a timely manner, and be thorough when they’re attending their policy holders.
  • Digital accessibility – If working with an agent isn’t your style, you have the option to find an insurance provider that lets you take care of everything online. Whether it’s an online portal or a mobile app, increasing numbers of companies are doing business online; you may be able to take advantage of this feature with your home insurance provider.
  • In-person accessibility – Some people like to do things face-to-face, especially something as big as a home insurance policy. If this sounds like you, make sure that any companies you consider have offices near you. It also wouldn’t be a bad idea to look for a provider that offers 24/7 claim reporting and customer service.

Check third-party ratings

Reviews from actual customers will definitely help you gauge a home insurance provider’s trustworthiness, but you should also look at the ratings given by third-party organizations. For example, J.D. Power ratings are based on a company’s handling of claims, agent interactions, and price-related customer feedback – basically, you’re getting the whole picture in one rating.

Standard & Poor’s (S&P) ratings and AM Best ratings will also give you a better idea of what you’re working with; they indicate the financial strength of an insurance provider. If the company has a good rating, that means they’re able to repay policyholders, and aren’t at risk of going out of business.

Examine the features of your home

It’s pretty obvious that the cost of your home insurance policy will be influenced by the size of your house, there are other features to consider. For example, some providers offer better deals for homes with specific features such as impact-resistant roofs, home security systems, or higher-quality construction materials.

If you’re interested in maximizing the payout from a claim, you might want to get a replacement cost value (RCV) policy, rather than an actual cash value (ACV) policy. With an ACV policy, the payout would factor depreciation into the final amount; you’d only get the estimated amount you lost, not what it would cost to replace it. With an RCV policy, however, the cost of replacements would be completely covered. You might also be able to get a deal on other coverage items that would be relevant to your property, such as sump pump coverage, water backup coverage, or yard and garden coverage.

Consider the location of the house

Just like with the size of the house, the location of the house will have a big influence on your home insurance bill.

  • Is the home close to a fire station? Home insurance providers love houses that are located within a mile of a fire station. The response would be almost immediate in the event of a runaway blaze, meaning fewer repairs for them to pay for.
  • How’s the weather? Extreme weather events like hail, tornadoes, or hurricanes can do some serious damage. If you live in an area where these things are common, you’ll probably have to pay higher premiums for weather-related insurance coverage.
  • Is there a lot of criminal activity? Coverage for break-ins is pretty standard, so if you’re likely to file a claim for it at some point based on crime rates in your area, that’ll be reflected in your insurance rates.

Getting the best home insurance policy isn’t as complicated as it might seem; all it takes is a little homework and some common sense.

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