Home Insurance Buying Guide

How to Shop for Homeowners Insurance Like a Pro

(Because your home and your stuff will thank you for it)

How to buy homeowners insurance

Homeownership can be thrilling. You get to set the rules for when it’s time for lights out, and the possibilities for Netflix binges with midnight snacks are infinite. Thing is, in order to enjoy those freedoms that come with the territory, you really need to equip your home with the proper protection. Homeowners insurance protects your home from common hazards like fire, theft, and tons more. So here’s a closer look at how to buy it, when you need to get it, and more.

Where and How to Buy Homeowners Insurance

When you’re on the hunt for the right policy to protect your home, luckily independent insurance agents can fight most of that battle for you. Independent insurance agents shop multiple insurance companies for you to find the right protection at the best possible rate. They’ll even hook you up with multiple quotes and options for you to choose from.

Working with a local independent insurance agent also puts you at a distinct advantage, because local agents know the coverage needs in your specific area. For example, they know that in certain areas of the country your home will be prone to various natural disasters, and they’ll know what additional coverages to search for in order to get you all the protection you need. Really, it’s a win-win.

When to Buy Homeowners Insurance

Honestly, you need to get coverage before you’re handed the keys to the new place. As a general rule, many mortgage lenders require you to have proof of insurance before you’re allowed to close on your home. So it’s best to get a head start on shopping around for insurance before you get super serious about buying your new home. That way you’ll have a better idea of what coverage you’re looking for, and it won’t slow down your house hunting journey.

The good news is that as soon as you’ve made your first premium payment, most homeowners insurance policies are immediately effective. That means you don’t need to wait the duration of a grace period for your coverage to kick in. If you purchase your policy before closing and make your first premium payment promptly, your home will be protected right upon move-in. Now that’s a relief.

What to Look for When Buying Homeowners Insurance

While independent insurance agents can do much of the hard work for you, it’s still beneficial for you to be familiar with what coverages are included in standard homeowners policies before ever calling them. Your specific homeowners insurance policy may end up looking a little different depending on your unique home’s needs, but in general, there are four major coverage components in standard policies.

Typically, standard homeowners insurance policies provide the following coverages:

  • Structural damage: Covers what insurance companies refer to as the “dwelling,” or the structure of the home itself. Damage to or destruction of the dwelling by covered perils falls under this category. Coverage often extends to detached structures such as sheds, as well.
Personal property damage
  • Personal property damage: Covers your personal belongings like furniture, clothing, electronics, knickknacks, old toy collections, silverware, etc., from perils such as fire or theft. Items stored within the home as well as external storage units are covered, though property stored off premises may have a lower coverage limit.  
Liability insurance
  • Liability: Covers legal expenses such as attorney and court fees in the event you are sued for bodily injury or property damage to a third party. Settlements you’re ordered to pay if you lose the case are covered as well. Coverage extends to all members of the family living within the home, including pets. Many incidents that occur away from the home are also covered.
Additional home living expenses
  • Additional living expenses: Covers living expenses in the event your home gets badly damaged or destroyed, and you’re forced to live elsewhere while awaiting repairs. Your insurance company provides reimbursements for things like hotel rooms, eating out, extra gas mileage, and more. Additional living expenses cover the difference in spending to maintain your normal lifestyle while living away from the home.

Your independent insurance agent can further explain these coverages for you and why you need them if you have questions. They’ll also work with you to make sure you walk away with enough coverage in every area for your new home.

What’s the Best Type of Homeowners Insurance for Me?

Well, that depends entirely on what type of home you live in. It’s pretty self-explanatory, really. If you live in a townhouse, you’ll need to get townhouse insurance. If you live in a houseboat, you’ll need houseboat insurance, and so on.

While the core of many different types of homeowners policies often remains consistent as far as the coverages included, depending on your home type and its correlating policy, your insurance will be tweaked a little to meet its unique protection needs. Plus, no matter what kind of home you have, your independent insurance agent will know what coverages to look for to get you set up with exactly what you need.

Here are a few of the most common types of homeowners insurance policies:

  • Townhouse insurance: Designed for owners of townhouses. It is pretty self-explanatory. If the townhouse is also a condo, coverage will include protection for the owner’s share of the “common areas” within the community.
  • Mobile home insurance: Designed for owners of homes constructed in a factory and then taken to the property to be set up. These homes may be on wheels, but not necessarily. Coverage still looks very similar to standard homeowners insurance.
  • Modular home insurance: Designed for owners of homes that are constructed in factories and then shipped in sections to be assembled on the property. Again, coverage looks very similar to standard homeowners insurance.
  • Houseboat insurance: Designed for owners of watercraft, such as yachts, that also double as homes. Coverage includes elements of watercraft policies and mobile home policies.
  • Condo insurance: Designed for owners of condos. Coverage includes protection for the condo owner’s percentage share of the “common elements” within the main building as well as any structural/fixtures within the unit that the owner is responsible for.
  • Vacation home insurance: Designed for owners of cabins, lake houses, etc., that serve the specific purpose of being used for recreational activities and are not the primary residence.
  • Secondary home insurance: Designed for owners of more than one primary residence. Coverage for the second home will be practically identical to the first.
  • High-value home insurance: Designed for owners of very expensive homes like luxury estates. Coverage limits are much higher than in traditional homeowners insurance, and policies may include add-on coverages such as kidnap and ransom insurance for high-profile individuals.

Depending on what type of home you live in, your homeowners insurance policy will be tailored to match it. Be sure to talk to your independent insurance agent about your home and any specific concerns you have about it. Together, the two of you will ensure that you get set up with adequate protection.

Great Homeowners Insurance Companies

Now that you know a bit more about where to go for homeowners insurance and what to look for, you might be interested in some of the top-rated, reputable homeowners insurance providers. These insurance companies have all received excellent ratings across multiple platforms as of the year 2020:

  • Allstate: Known for their wide range of discounts and being accessible to first-time homebuyers.
  • Amica Mutual: Known for their quick claims processing and great customer service.
  • Auto-Owners Insurance: Known for their financial strength ratings and unique coverage offerings.
  • Erie Insurance: Known for their low rates and for offering replacement cost coverage for personal property.
  • Farmers: Known for their extensive coverage options and for offering state-by-state policy customization.
  • Geico: Known for offering customers flexibility in assembling their own coverage and having ample customer service reps.
  • Metlife: Known for their guaranteed replacement cost coverage for personal property.
  • State Farm: Known for their highly affordable insurance rates.
  • USAA: Known for offering great coverage for the military and offering outstanding customer service in general.

Your independent insurance agent will help hook you up with a homeowners policy from a reputable insurance company. If you’re leaning towards one company in particular, be sure to mention that to your agent.

Benefits of an Independent Insurance Agent

Independent insurance agents have access to multiple insurance companies, ultimately finding you the best coverage, accessibility, and competitive pricing while working for you. Find an independent insurance agent in your community here.

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TrustedChoice.com Article | Reviewed by Paul Martin

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