What Makes a Great Homeowners Insurance Company?

By | 04.10.2018

Home insuranceOwning a home is an accomplishment and an asset, one that deserves safeguarding. The best homeowners insurance providers offer financial strength, coverage options, and great customer service.

Reviews.com put together a comprehensive list of the best companies based on this criteria. Bellow is a summary of that information.

What Makes a Great Homeowners Insurance Company

Nationwide availability

While local or special eligibility insurers can potentially write you a great homeowners policy at a competitive rate, large national carriers tend to have more discounts and bundling opportunities. They’re also better equipped to handle claims in the wake of a disaster. Their rolling claims centers, outfitted with generators, satellite connections, and agent workstations, can make all the difference in areas where power has been knocked out.

Financial strength ratings

The ability to pay claims is the backbone of any insurance, so the best way to compare insurance companies is to look to their financial solvency and outlook. Top-rated insurance companies receive financial strength ratings (FSR) from all three major rating agencies: A.M. Best, Standard & Poor’s, and Moody’s.

Policies plus endorsements

Basic homeowners insurance policies are often robust and relatively comprehensive. However, the more endorsements offered, the greater the possibility of filling in any gaps that your home and location demand. Earthquake coverage, for example, is a common endorsement for Los Angeles homes.

Customer Service

Good customer service ratings means painless communication between the homeowner and the homeowners insurance provider in every phase. You’re more likely to receive accurate quotes and sufficient coverage and be properly compensated for claims. J.D. Power’s annual U.S. Household Insurance Study is a great place to start when considering customer service scores for most major providers.

Discounts

Your best possible price equals a competitive initial quote, plus lots of opportunities to save. Often, the most significant discounts, like those for owning a fire extinguisher or being claim-free, are offered by every provider. There are also exceptional discounts that make certain providers a better fit for certain homeowners. A few examples: Allstate’s “new purchase” discount gives a small break to first time home. And Travelers’ Green Home Discount knocks 5% off the premium price for certified “green” homes.

How Calculate Your Homeowners Insurance Needs

Calculating home insurance costsReconstruction Cost

How much would it take for a full rebuild of your home? Your coverage limits for personal belongings and other structures are related to the amount of coverage on your dwelling. You’ll have better protection for all your property if you assess the full reconstruction value of your dwelling instead of calculating only piece-work repair costs.

Catalog Belongings

Many providers have online lists or apps that can help to keep track of personal belongings and their value in relation to your homeowners insurance coverage. This is an important step in keeping your family and possessions covered as you acquire more things and property.

Consider your location

Take into account your areas propensity for natural disasters. Are you prone to flooding? Tornados? Earthquakes? These things will affect your premiums, coverages, and discount options. You should also use this information to inform on which additional coverages you should include on your policy.

Homeowners FAQ’s

What does home insurance cost?

This will vary for every person based on a multitude of factors. Prices can be radically different even between neighbors. Below is a list of major contributing factors.

  • Credit score
  • Location
  • Home condition
  • Vulnerability to natural disasters
  • Claim history
  • Home replacement cost
  • Pets
  • Heating sources
  • Liability limits
  • Marital status
  • Risk contributing factors (trampoline, swimming pool, hot tub, etc)
  • Roof condition
  • Proximity to fire station
  • Square footage
  • Number of inhabitants
  • Security systems and safety features

What does home insurance cover?

  • Dwelling (also called Coverage A). Main building and its plumbing, heating, and air conditioning systems against damage from outside forces.
  • Other structures (or Coverage B). Damage to fences, sheds, garages, guest cottages, and any other structure not connected to your house.
  • Personal property (or Coverage C). Lost, stolen, or ruined possessions such as furniture, electronics, and clothing, even when they aren’t on your property.
  • Loss of use (or Coverage D). Living expenses during the time you’re unable to live in your damaged home.
  • Liability (or Coverage E). Financial loss if you or anyone in your family is sued for damages or injuries to someone else. The event doesn’t have to happen on your property.
  • Medical payments to others (or Coverage F). Minor medical bills resulting from an injury, like if a friend cuts their finger while helping you make dinner.

Will my premiums go up if I make a claim?

More than likely, yes. Filing a claim on your homeowners insurance, will directly affect the amount you’ll pay going forward. If you have two claims within three years, or three claims within five years, that increase can be as high as 20% as you’re shifted into a “high risk” category.

What’s the difference between home insurance and home warranty?

Home warranty for plumbingHomeowners insurance is there to protect you in the event of a disaster, not to cover normal wear and tear.

A home warranty, on the other hand, covers the mechanical breakdown of appliances and systems in the home, like the refrigerator, the washing machine, and the electricity and plumbing that make them run.

To learn more, check out the full review at Reviews.com.


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