Home Insurance Rate Comparison

home insurance rate comparisonHome insurance is important because it protects the basic human need for shelter. Whether you own or rent your home, the contents, building, and essential need for shelter is covered by the home insurance policy you purchase to protect you and your family’s needs for necessary security and shelter.

Premiums for home insurance can vary from a high of almost $2,000 per year in Florida, a state with a high incidence of hurricanes, to about $500 per year in Idaho. States with high incidents of natural disasters tend to have higher home insurance rates due to heavier losses.

Statistics from the Insurance Service Office (IS0) indicate the following levels of loss on home insurance policies per 100 house years during the period from 2008 to 2012.

  • 3.37 – wind and hail
  • 1.79 – water damage and freezing
  • 0.52 – theft
  • 0.43 – fire, lightning, and debris

Unfortunately, statistics from the ISO are available only to insurance companies and agencies at the cost of a subscription.

Be sure to always compare rates for home insurance by using the FREE comparison tool at the top of this page!

Lower Insurance Costs

A number of ways to lower your insurance costs are available:

  • Do comparison shopping – shop for the best insurance company by examining complaints and financial ratings through both the National Association of Insurance Commissioners (NAIC) and your own state’s insurance department, other sources for ratings are A.M.Best Rating Services, or Standard & Poors Ratings.
  • Shop for the best price by then choosing at least three reputable insurance companies for quotations
  • Raising your deductible can save money. A higher deductible will give you more credit on your insurance premiums. Consult with your lender to insure that you will be able to afford the deductible, however. A $1,000 deductible saves you no money if you have to borrow to repair your home or replace items. Deductibles may vary according to the cause of damage because hail damage in the Midwest to West ordinarily has a higher deductible than the rest of the policy. The same situation applies to various other locations.
  • Estimate the cost to rebuild your home in a complete disaster accurately. Valuation for insurance purposes needs to be for actual or replacement cost of the home and/or contents, not for the land upon which it is built. A good, free resource for estimating rebuilding costs is through Building-Cost.Net.
  • Purchase home insurance and auto insurance from the same company for savings. You can save up to 20% of both premiums in this manner.
  • Prepare your home for disasters – a hail-resistant roof-metal roofs are a good choice, shutters to protect glass, updating electrical, heating, and plumbing systems, all can reduce your insurance rates.
  • Smoke detectors, carbon monoxide detectors, burglar alarms, sprinkler systems, and secure locks can earn credits for insurance. Make certain you do not pay more for the protective system than you earn in credits, though.
  • Ask your agent about further discounts because insurance companies vary from company to company on items for which they offer discounts.
  • Maintain a good credit rating because insurance companies use a modified version of your credit rating to determine rate classes for premiums.
  • Frame houses cost more to insure than brick houses.
  • New houses may receive credits, and older homes could possibly not qualify for preferred programs because they may need renovation for the heating, roofing, plumbing, and wiring.
  • Local fire protection can make a different in the cost of your insurance.

Types of Coverage in a Home Insurance Policy

Generally, these are the types of things insured in a home policy. In home insurance policies, an initial indicates each:

  • Type A – Damage to the house; amount chosen by the owner – This insurance is limited to the face amount on the policy. If you do not own the house, this insurance cannot be covered.
  • Type B – Damage to other buildings on the property such as a detached garage; limits are usually 10% of the house coverage. Again, if you do not own the house, this insurance cannot be provided.
  • Type C – Damage to or loss of household contents, including personal belongings used, owned, or worn by you or your family; limits are usually 50% of the house coverage.
  • Type D – Pays for additional living expense if needed, up to the stated amount to continue normal living if the house or apartment cannot be occupied as a result of a covered loss; limits are usually 20% of the house coverage.
  • Type E – Covers personal liability against claims springing from accidents to others on property you own or rent; you choose limits. This liability coverage follows you and applies to personal liability except for automobile liability or boating liability.
  • Type F – Covers medical expense limited to an amount per person and per accident for injuries that occur on property you own or rent; you set limits. This medical expense must be a result of an action performed by you, your family, or your pets. Note that this coverage is paid regardless of legal liability.

The broad coverage given in a home insurance policy is one of the advantages of this type of policy.

Perils Insured Against Under a Home Insurance Policy

Home insurance is discussed by form, and each form provides insurance for certain perils. Here is a brief rundown of these forms and perils:

  • Basic form and modified coverage form: Building and contents coverage – fire, smoke, windstorm, hail, lightning, explosion, vehicles, civil unrest, theft, and vandalism.
  • Broad form: Building and contents coverage – The same perils as the Basic Form plus: trees and other falling objects, weight of ice, snow, or sleet; freezing, rupturing, or sudden and accidental overflow of plumbing, heating, air conditioning system, or a household appliance.
  • Special Form: Building and contents coverage including all of the above except earthquake, war, nuclear accident, and other perils specifically excluded in the policy. This form is usually more expensive.
  • Tenants Form: Contents coverage only – The same perils are covered as under the Special Form, just applying to contents only.
  • Condominium Owners Form: Contents coverage as well as common corridors and walls coverage for the same perils as under the Tenants Form.

rate comparison for home insuranceNotes about Earthquake coverage and Flood Insurance: These perils are not covered under the home insurance policy.

In California, a special exchange provides access to earthquake insurance.

Flood insurance advice can be obtained through Flood Smart, a federal program offering subsidized premiums for flood insurance.

Obtaining Insurance Quotations

After examining insurance companies, choose the companies to ask for quotes. They will need to know the construction and location of your residence whether you own it or not.

They will ask about protection devices, too. Weigh the quotations carefully to be certain that you are getting the best insurance as well as the lowest price.

Once you receive your new policy, read it carefully to make sure you received the coverage you requested and so you know the policy provisions.

Keep the research you have done for further consultation next year.

Compare rates instantly using the FREE search tool below!