How to Make Sure You Have the Best Homeowners Policy
There are many factors to consider when looking for homeowners insurance and understanding what to look for can help you make the right decisions and buy the best policy for your home.
Homeowners insurance can be complicated, and its possible to spend months looking for the perfect policy, but the truth is that the best homeowners policy is the one that provides the coverage you need at a price you can afford.
There are many factors to consider when looking for homeowners insurance and understanding what to look for can help you make the right decisions and buy the best policy for your home.
Things to consider when dealing with homeowners insurance:
Carry the Right Coverage Levels – The best homeowners policy offers the proper amount of coverage. Consider having a homebuilder or inspector do a walk through of your home and give you an estimate of rebuilding costs. Base your coverage levels on this estimate. Review these coverage levels yearly to make sure they are still adequate. If you make home improvements your policy should reflect the increased value.
Certain valuables may not be covered under a typical home policy, if you have expensive jewelry or art in the house make sure your policy covers these items. A rider may be necessary to offer the proper protection.
Shop around – Everyone has different needs when it comes to homeowners insurance. While flood coverage may be important to one person another may only be concerned about the liability protection.
Programs and rates will vary dramatically between insurers so getting as many quotes as possible is a good way to make sure you find the exact coverage you want at the best price for your budget. Be sure you are comparing apples to apples in terms of coverage and deductibles when shopping.
Research – When comparing insurer quotes be sure to research the companies you are considering. Check their financial strength with companies such as A.M. Best, Standard and Poors as well as the Power Circle ratings at J.D. Power. Check customer satisfaction ratings as well.
J.D. Power and Associates puts out an annual National Homeowners Insurance Study which ranks insurers by customer satisfaction. This survey is great place to research companies. Amica has grabbed the top spot for the past 11 years running. Remember that everybody’s insurance needs are different, so find the company that is best for your needs.
Consider Bundling – Bundling your homeowner’s insurance with your auto or other policies can result in big savings as well as increased customer satisfaction. According to J.D. Power and Associates, customers who bundled policies expressed increased satisfaction with their insurer. When shopping your homeowner’s policy around, consider including your auto as well.
Natural Disasters – If you live in a flood prone area, or a hurricane zone there is a very good chance your standard policy is not going to cover damage from these types of disasters. The last thing you want to hear after your home floods is that you are not covered. Make sure your policy offers the protection you need, in most cases you will have to purchase a separate flood policy.
Personal Belongings – Rebuilding your house is not the only issue you have if disaster strikes, you have to fill it back up with all the stuff you lost. When it comes to your personal belongings, look for replacement value instead of actual cash value.
Actual cash value policies will only pay out the value of your belongings when they were destroyed, often this will not be enough to replace the item. On the other hand a replacement value policy will pay for a new item regardless of the cost.
A homeowners policy can be a lifesaver if you experience a catastrophic event, use these tips to make sure you are properly protected.