When you’re choosing which home insurance company to use, you have options. Often, it can seem like there are too many options. Keep reading to learn how to choose the best home insurance company to go with.
Will You Qualify?
It may surprise you to learn that not everyone can qualify for home insurance. If you can qualify, you may not qualify with every home insurance company. Here are some of the things that might disqualify you.
- Lapsed coverage. If you have a gap in your coverage, the home insurance company might think something happened to your house during the lapse in coverage that you now want to try to get coverage and file a claim as if it happened while you were covered.
- High-risk areas. Different insurance companies have different risk tolerances, and some choose not to insure homes in riskier areas. This might include flood zones, coastal areas, earthquake fault lines, areas with sinkhole problems, and anything else that creates unusually high risk.
- Not doing home maintenance. If your home is in disrepair, it could be weakened and at greater risk from wind, rain, and fires. Disqualifying maintenance issues can include things like an old or faulty roof or electrical problems.
- Criminal history. If you have a criminal history, the insurance company may worry that you may lie on your insurance application, engage in risky behaviors that could damage your home, have increased liability from people coming to your home, or have people that may want to harm your home.
- Home businesses. Home insurance companies have various tolerances from home businesses based on what type of work you do and whether clients come to your home. However, businesses are much riskier to insure, and home insurance companies may not want to take that risk on.
- Claims history. Many home insurance claims are unavoidable, but if you keep having to file claims, insurance companies will often decide you’re too risky to ensure.
When you read up on home insurance coverage, it can sound like every insurance company provides the same coverage. Most home insurance policies are in fact almost identical. It’s that almost that can cause you major problems if you haven’t read the fine print.
Each insurance company has slightly different lines for what types of incidents they’ll never cover, what types of incidents have lower limits than your primary limits, and what’s included in your basic coverage versus what you need additional coverage for. If your original home insurance company included something like plumbing backups and you switched to a cheaper option without realizing you needed to buy that coverage separately, you could be in for a very expensive surprise.
Just as insurance companies are willing to take different risks and offer different coverages, they calculate their prices differently. It isn’t like buying clothes where one brand is almost always more expensive than another. One insurance company might give you a very low quote on a brand new home. But if their pricing formula prefers brand new homes, they might be the most expensive option after you’ve been there for five years. Plus, they’re always adjusting how they calculate pricing, so check rates every year.
Work With an Independent Insurance Agent
An independent insurance agent can help you find the best home insurance company. Instead of selling for one insurance company, they work for you to help you find the right one to buy from. Contact Smart Move Insurance to learn more or get a quote.