What to Look for When Comparing Homeowners Insurance
Are you a new homeowner shopping for the right insurance policy for your needs? Or maybe you’re trying to figure out what your needs even are? It is important to look at all of your options, including cost, what is included and what kind of service you can expect with your policy.
There are plenty of sites and brokers that will work up a comparison of top and local companies for you, but you should still be able to understand what is in the details of each offering and rate them against what you value the most.
Assessing Policy Cost
The cost of your insurance will depend on many factors. Some of them are out of your control post-purchase (i.e. the size, age or location of your home), while you have the power to influence others. For example, you can take advantage of lower premiums and insurance discounts by bundling insurance policies with one provider or making your home less of a risk for a claim by installing water leakage detection systems or burglar alarms. Remember, the number one home insurance claim is due to water damage and the cost of these claims can skyrocket if that damage goes undetected for a long period of time.
What is Covered
Insurance companies often break their packages into different levels of offerings. Starting with a basic plan that covers certain damage-related costs and working up to a package with extended dwelling, liability and additional structure coverage. In some cases, extra coverage may only be included as an add-on to a standard policy offering. It may even be better that way because you can pick and choose what you need instead of going with the most comprehensive option and paying a premium for something you do not really need.
Again, the important thing here is to understand what you need, what options are available and the best way to package those options so you get the best price.
Customer Service
If you see a marked difference in the cost between companies, ask them why. By doing a little digging, you might find that they have more staff in the office to answer your calls and help you with claims, letting you avoid long wait times and robo-answered calls in the future. If this is something that you value, you might feel like paying the additional price.
In addition to the nuts and bolts of how they deliver their services, do a quick Google search and ask your friends. Do the companies on your list have a positive reputation? Or are they plagued by nasty Google reviews and audible shudders when you ask your co-worker if they have ever dealt with them? A cheap price tag might be attractive but often if something seems too good to be true, it is for a reason. You will thank yourself for paying a little extra for a provider with a positive reputation when you have to file a claim and the process is smooth, quick and painless.
Deductibles
When you have your options in front of you, think about the deductibles that you will pay. How much will you need to pony up out of your own savings before your coverage kicks in? In addition, what are the maximums in each claim category? Compare that to how much damage it would likely cost to see if it makes sense for you in relation to the deductible you would have to pay. Would there be much of a payout in the end? Is that payout worth it against the premium you’ll be paying monthly or yearly?
Of course, price is key and everyone is concerned with how much a policy will set them back. But, in order to get a true picture of the cost and value of a policy, you need to understand all of the details and what they mean for your situation.
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