Your home and all your stuff is a big investment, so naturally you don’t want to go with a company just because you see a commercial on TV. Here are some tips to help you start your shopping journey.
determine how much coverage you need
The key to determining how much home insurance you need is to look at each type of standard coverage and adjust the amounts to fit your specific needs, then add additional coverage to cover any gaps. this is what it would look like:
- dwelling coverage. Since the cost to replace your home and other structures can vary based on local construction and material costs, it’s hard to find a number on your own. your insurance agent can help provide an estimate. It’s a good idea to add additional coverage like guaranteed or extended replacement cost coverage, if available, to help offset possible surges in local construction costs, especially if your area is prone to natural disasters.
- contents coverage. A good way to figure out how much coverage you need for all of your stuff is to create a home inventory. It’s a good idea to have “replacement cost” coverage in your home insurance policy, which pays for the cost of new items. actual cash value only pays for the depreciated value of damaged items.
- Liability coverage. You want to buy enough liability coverage to cover what may be taken from you in a lawsuit, like your savings.
- additional living expenses (ALE) coverage. ALE coverage is usually set at a percentage of your dwelling coverage, such as 20%. but if you need more, you can increase your loss of use coverage. this pays for additional costs if you cannot live at home due to damage.
- Other Types of Coverage. You can fill in the gaps in a policy with types of coverage such as flood insurance, earthquake insurance, overflow and sinkhole insurance, and home systems failure coverage.
- online. You can get them on an insurer’s website or by visiting a website that specializes in providing multiple quotes at once.
- insurance agent. An independent insurance agent may obtain quotes from several companies. a “captive” insurance agent only works for one company.
- new or renovated home discount. this is a price discount that often requires wiring and plumbing upgrades.
- security discounts. Having fire safety devices (such as smoke alarms and sprinklers) and security devices (such as burglar alarms and locks on exterior doors) often earns a discount.
- age roof discount. if you have a newer roof, your insurer may lower your rate.
- disaster preparedness discount. ask about this discount if you take steps to protect your home from natural disasters, like installing storm shutters and shatterproof glass if you live in a hurricane-prone area.
- multi-policy discount. This discount is often available if you purchase more than one type of policy from the same insurance company, such as auto, RV, and motorcycle insurance. Combining auto and home insurance is often one of the best discounts you can get.
- multihome discount. If you need to insure more than one home, find out about the discount if you insure them with the same company.
- no claims discount. ask about a price discount when you don’t have a recent insurance claim history.
- Insurance payment discounts. You can often get small discounts for going paperless and paying your premium in full.
- employment, organization and association discounts. depending on your occupation (such as educators) or if you are a member of a union, professional organization or alumni association, your insurer may have a membership discount .
compare home insurance quotes
once you know how much coverage you need, you can start shopping around. It’s important to compare home insurance quotes from multiple insurers because rates can vary considerably for the same coverage.
You can get free home insurance quotes:
discounts on home insurance
be sure to ask about discounts. here are some common types to look for: