How to Choose Homeowner’s Insurance that is Right for You

Being a homeowner, especially for the first time, is exciting yet stressful. Whether the home was recently contracted, or the house needs some contractor work done, one wants to make sure their home is safe, secure, and covered should something unforeseen happen to the home. Buying homeowners insurance is a great first step in making sure that the home is covered and safe. A question that most homeowners ask themselves though is: How can I choose the best homeowner’s insurance policy for me and my family? If you are asking that same question, you don’t have to look any further. Below there is a perfect formula to choose the best homeowner’s insurance to meet one’s individual needs.

Shop the Market

The first step to choosing the perfect insurance policy for you and your family is to shop around. Do not just choose the first policy/company you find, as many policies will rob you of what you are needing, which could end in a disaster. Many people in the construction and real estate industry are just growing a construction business or real estate business. This is why choosing the right policy requires some major research into different companies, which requires full attention to even the small details of each policy. It is best to check out at least 5 companies before making the final decision on a homeowner’s insurance policy. In addition, one should ask each insurance agency lots of questions and read, or have explained to them, the details in fine print.

Choosing Your Policy

Different insurance policies have different coverages, limits, deductibles, and exclusions, so make sure to review several policies from several different companies before making your final decision. One should make sure to check out every detail of different policies and may even have to add things to the best policy to make the terms/conditions work. For example, there might be things inside the home that can also be insured. If so, one might consider endorsements or floaters. Endorsements increase the amount that one would be able to cash in should a claim be filed. On the other hand, floaters provide more flexibility because one can name specific items to be insured.

Make Sure You Have All Your Bases Covered

To get the best deal on homeowner’s insurance, one must make sure that they pay close attention, not only to what the policy includes as far as premiums, coverage, deductibles, etc., but also any type of extras they could do to the home to qualify for extra savings. For example, most insurance companies will provide a discount if the homeowner’s get carbon monoxide deters, fire alarms in each room, a different type of heating, security systems, and more. Sometimes, spending a few extra dollars on the home can earn a homeowner big savings.

Another thing to consider is how much the home is worth, which will help the homeowner decide how much insurance to take out. It is recommended that a homeowner take out more than the house costed to build or buy, how much the land is worth, location of the home, and the current cost of construction. 

Ask About Discounts

Different companies offer certain discounts, but you must ask about them because they are not generally advertised or mentioned in the initial policy guidelines. Therefore, if you do not think to ask about discounts you qualify for, then you simply miss out on great savings. Every dollar saved certainly adds up! Some insurance agencies, for example, give discounts for veterans, multiple policies such as home/life/auto insurance, new homes, non-smokers, the location such as a gated community home. Another example could be general contractors looking for subcontractors and looking for who can give them the biggest discount so they can do business.

Research the Company’s Financial Strength

One of the last things one would need is to find that their insurance company is about to go under, financially. It is important to check and research the financial strength of each insurance agency. An insurance company that is in financial strain sets off a red flag about insufficient/cooked management, which can lead to the agency shutting down soon. If an insurance agency is financial strain, how are they going to pay out if a claim is filed? Often, insurance companies that are in financial strain will change the conditions of the policy without notice or do crooked things such as making it look like the coverage had changed before the accident or warranty. In addition, some companies could be in business one day, and suddenly leave their clients with major financial loss. The stronger the company, the better. A.M. Best is a good place to review different agencies’ financial power.

Check the Ratings

JD Power is one good site to go when searching for those with high ratings. JD assesses insurance agencies annually based on several important factors including Overall satisfaction, policy offering, price, billing, interaction, and claims. Checking for overall satisfaction is important because it indicates the level of trustworthiness of the company. If customers are not satisfied there is something to be concerned about. Checking the ratings for several different insurance agencies can help one avoid problems in the future. For example, if saving money is the most important factor for a customer, and the customer ratings are low in the area of price, that customer can just keep looking. Therefore, taking the time to check different insurance agencies on various ratings can save a homeowner time, money, and aggravation. Furthermore, stay away from a company that has a low rating for billing because problems with overbilling could be a red flag of a company that is struggling financially.

Choosing Your Provider

Once an individual has researched many insurance companies and each one’s premiums, coverage, deductibles, etc., it is time to take the next step to purchase a policy. There are many insurance companies to choose from, including many that are online. Regardless of how the policy is purchased though, it is important to remember that one should not settle for anything less than the best policy. Not only should the policy be good but also the add-ons should be sufficient to provide the homeowner with the perfect policy, nothing less or more. For example, an umbrella policy can be added. An umbrella policy is extra protection for homeowners in case of unpredicted incidents involving the inside of the home and the contents surrounding the home. Extra protection would be needed in case of someone getting hurt on the property. An example of a homeowner who would benefit from an umbrella policy is one who has a pool on the property. For example, a child might decide to jump a homeowner’s fence while they are asleep, just to take a nice night swim, and end up drowning.

The Best Homeowners Insurance Depends on Your Needs

One can find the best homeowner’s insurance by taking proper steps to check multiple agencies and their coverages, reviews, prices, limits, deductibles, and exclusions, In addition, age, location, and condition of the home are all important factors that, can play an important role on the premiums, deductibles, and other terms/conditions of an homeowner’s insurance policy because the more likelihood of something happening to the home, the less likely a company is to insure the home. Therefore, it is important to be truthful about the questions that are asked, to avoid wasting time and/or money on coverage,