Comparing home insurance policies requires patience and determination. Most people would jump to the end and compare just the annual premium they are quoted by each insurance company. This can be a drastic mistake as coverage amounts are mainly dependent on the insurance policy’s components. A substantial reduction in a single coverage amount can cause a sizable decrease in the premium. The issue will appear when a claim is declined due to the policy not providing enough coverage.
The smart shopper will compare each and every amount on each and every policy they’re considering with the use of a spreadsheet. Every insurance company will have a column, and each row will have the same category. If you make exact comparisons, you can easily spot discrepancies which explain why the premium amounts are not the same. Writing notes next to each of the categories will keep you reminded as to why you excluded a specific insurer from consideration.
While comparing basic home insurance policies, expect their prices not to vary significantly. Home insurance companies provide discounts as a way of encouraging encourage homeowners to protect their property, such as by setting up security cameras or fire suppression devices.
Of course, a good home insurance shopper will take advantage of every discount possible. The cash you spend to install the recommended risk-mitigating measures can save you up to thousands in the form of reduced premiums. And by choosing the same insurer for your auto and life policies, you can be rewarded for your loyalty through multi-policy discounts.
The limits for liability insurance are raised as insurance companies are aware of litigation against the homeowner being a possibility. 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 should you consider when making comparisons among different providers?
First of all, industry 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 determined according to the company’s performance in different areas, including claim handling. A company with low ratings has a considerable number of consumer complaints filed by its customers.
Also look into an insurer’s customer service model. Central customer service gives basic support to customers, and this acceptable to some policyholders. Local agents give guidance through the entire term of the policy and give recommendations for coverage adjustments when needed.
Finally, rapid claim response after a loss is crucial to the homeowner. Experienced claims adjusters give enough estimates to include needed repairs to the home.