Best Companies for Home Insurance

Deciding upon the very best home insurance company is a bit problematic. A great deal depends upon the criteria applied to determine the “best”.

Many people consider low premiums to be the most desirable attribute for a home insurance policy. Others consider the following as necessary criteria for a desirable home insurance company:

• Adequate and accurate payment for real damage-less deductibles, of course
• Problem-free settlement of claims
• Courtesy and service by the agent in the event of a claim
• Timely and prompt response to report of a claim
• Financial stability of the company – Does it have enough assets to withstand a catastrophic claim situation such as Hurricane Sandy, Hurricane Katrina, or a string of tornadoes across the Midwest?

All these criteria are valid requirements and sound ones to determine the best home insurance companies.

Make sure to use a quote comparison tool such as the FREE one above to search for insurance companies.

Consumer Reports, a leading on-line consumer reference (available by subscription) polled their readers with regard to all the criteria except financial stability and the top five companies writing home insurance recommended were:

• Amica Rated by readers as a 94 out of a possible 100 points.
• USAA Rated by readers with a 92 of possible 100
• Auto-Owners Rated by readers with an 89 of a possible 100
• Nationwide Rated by readers as 84 of a possible 100
• Erie Rated by readers with an 82 of a possible 100

Another rating company, A.M. Best, that provides credit ratings for insurance companies rates all the companies noted with an A or better rating – up to an A++.

This indicates a secure financial status for these companies.

J.D. Power and Associates, a member of the McGraw-Hill Financial Group did another survey among their readers and Amica was given an award for the best insurance in this particular poll. Auto-Owners, Nationwide, and Erie also showed up in their ratings.

USAA prefers to insure individuals with military backgrounds.

Standard and Poor’s is another financial rating service that will indicate the financial ratings of insurance companies. They base their ratings upon the Dow-Jones averages and update these ratings as needed.

Sound financial abilities as well as excellent customer service create a great deal of customer satisfaction for home insurance purchasers.

Getting Quotes for Home Insurance

People who shop around for home insurance and do their due diligence tend to get excellent value for their insurance premiums. You should acquire at least three quotations (price estimates) for your insurance needs.

Obtain these estimates from insurance companies who write insurance in your state and have excellent ratings for service, claims handling, and financial stability.

Begin your search for quotes by examining the costs of replacing your home in the current builder’s market. You may find that replacing it in the event of a disaster can cost considerably more that the amount you paid for the dwelling.

One cost estimation calculator is free for you to use, Building-Cost. Net. This will help you avoid figuring in the costs of the lot and utility connections needed to service the property.

That way you just insure the building, adjunct structures, contents, and liability. Too often, the over-all cost of a home can include extra things you do not want to insure.

Home Insurance Values and Percentages Set by the Average Policy

The average home insurance policy provides insurance as follows:

• Dwelling – the amount you choose – The value set should be at least 80% of the replacement cost to comply with your policy.
• Structures such as a separate garage, a gazebo, or fences, have a value set of 10% of the amount carried on the dwelling. If you need more, increase this value.
• Contents of the dwelling are usually set at 50% of the value of the house. Antiques, jewelry, and art works of exceptional value should be listed specifically on the policy because they will often increase your value to more than 50%.
• Loss of use, in which the insurance company pays to help you establish a separate temporary residence (up to the limits of the policy) while the home is being repaired or replaced.
• Personal liability, which pays for legal liability for injuries done to others by you or a member of your family, is important. The limit on this is usually $100,000, but can be more if you wish.
• Medical payments, which pay for injury to another on your premises by a member of your family or a pet, are offered.

Perils Covered by Most Home Insurance Policies

These perils are roughly the same for every home insurance policy but it is still an excellent idea to reiterate them. For full descriptions of the perils against which your insurance policy protects, be certain to read the policy. Common perils insured are:

• Lightning, fire, smoke, explosion
• Windstorm, specifically tornadoes and hurricanes
• Vehicle damage – when the neighbor’s teenager accidentally runs into your front fence
• Theft, vandalism, and civil unrest
• Freezing and rupturing of HVAC systems is covered in the event of a sudden and accidental overflow. This, too, applies to household appliances — but not to general leaks.

Flood and Earthquake Insurance

Flood insurance can be purchased through your local agent.

For the names of agents and details of this coverage, go to FloodSmart. Earthquake insurance, too, is available from your local agent. Be sure to ask.

Deductibles and Other Things Can Save Premiums

Deductibles, used judiciously, may save money on your premiums because most insurance companies give credit for higher deductibles. Observe what you can afford and what you need.

Other things that can save premium dollars on your home insurance policy are:

• Purchase home and auto insurance policies from the same insurance company because it can save you up to 15% on premiums.
• Keep a good credit record – insurance companies may use your credit record as a basis for ratings.
• Upgrade security with smoke detectors, dead-bolt locks, and central-station alarm systems if affordable. All of these can earn credits on your policy.
• Query the insurance company about further discounts that may be available.

Purchasing Home Insurance

Collect the quotations you received for home insurance, re-examine the ratings, policy coverage, as well as premiums quoted.

Do be careful to read the policy once you receive it, and then plan to go through the same process next year.

It is easy to become complacent and forget to do this important research annually.

Use the FREE quote tool below to start your search for home insurance.