Comparing home insurance policies requires patience and determination. In most cases, people will just look at the annual premium that their prospective insurers have quoted them. This is a big mistake, knowing that the contents of the insurance policy form the basis for the coverage amounts. A sizable reduction in one coverage amount can decrease the premium considerably. The problem will come up when a claim is not accepted because of inadequate coverage on the policy.
The wise shopper compares all amounts on all policies using certain tools, such as a spreadsheet. Every insurance company will have a column, and each row will have the same category. When you make exact comparisons, it will be easier for you to see discrepancies explaining why the premium amounts differ. Adding notes next to every category will remind you why a certain insurance company was eliminated from consideration.
While comparing basic home insurance policies, expect their prices not to vary significantly. Home insurance companies give discounts to encourage homeowners to keep their property safe, such as by installing fire suppression and security devices.
Of course, a good home insurance shopper will take advantage of every discount possible. The money spend on recommended risk reduction measures will can reduce insurance premiums in the coming years by up to thousands of dollars. And by choosing the same insurer for your auto and life policies, you can be rewarded for your loyalty through multi-policy discounts.
The liability insurance limits are increased since insurance providers know it’s possible for the homeowner to face litigation against them. In the event of a major lawsuit, additional coverage can be provided through an umbrella liability insurance policy, where the property and livelihood of the insured are guarded against loss.
So what exactly do you consider when comparing different home insurance providers?
First is reputation. Look up your prospective providers’ third-party ratings online. In the U.S., for example, all insurance companies that underwrite homeowner’s policies are rated by AM Best Company. The ratings are given based on the actual performance of the company in various areas, including claim handling. Low ratings reflect a huge number of customer complaints filed against the provider.
Another thing you should consider about an insurer is its customer service model. Central customer service offers standard support and is acceptable to some people. Local agents give guidance through the entire term of the policy and give recommendations for coverage adjustments when needed.
Lastly, timely response to a claim is of course critical to any homeowner. Experienced claims adjusters give enough estimates to include needed repairs to the home.