Things to Avoid When Shopping for Homeowners Insurance
By shopping around for homeowners insurance, you've already taken a step in the right direction. Comparing rates from several insurance companies will help ensure that you get the best policy for your home at the lowest price possible. Insure your home for how much it would cost to rebuild it should a disaster occur. A basic policy will cover the replacement cost of your house, as well as some coverage for your possessions, in the event of fire, theft and weather-related damage. Be aware of some common pitfalls when shopping for policies to save you time and money.
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Unequal Comparisons
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When shopping for coverage, don't assume you are comparing apples to apples. Given the fact that you're calling a multitude of companies, make sure that you obtain a quote for the same amount of coverage with each company you contact. Each insurance company's policies will be packaged differently. Clarify what you want to be covered in each quote you obtain.
Assuming Coverage
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Even if you take steps to make careful comparisons, don't assume that everything in your home is covered. You may need to purchase additional coverage for certain items. For example, you might assume that if all your jewelry were stolen, its entire value would be covered. However, this might not be the case. Companies often limit the amount you can claim, unless you have special coverage.
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Insurance History
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Before shopping around, know your credit and insurance history. Be aware that any claim you may have filed in the past is taken into account when determining premiums. People with poor credit or several high claims will face higher premiums. One way to help counteract high premiums is to increase your deductible, if possible.
Unaware of Discounts
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Inquire about discounts. If you have insurance policies with several different companies, chances are you are losing money by not bundling policies. Have the company price out what the discount would be if you purchased a car insurance policy in addition to a homeowners policy. Insurance companies also provide discounts for certain home features that lessen risk, such as alarm systems and a close proximity to a fire station.
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References
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