How to Switch Homowner’s Insurance Companies

If you find the very idea of shopping for homeowner’s insurance somewhat intimidating, don’t fret. Switching homeowners insurance needn’t be a complicated matter. By educating yourself as a consumer you can evaluate each homeowner’s insurance quote and no longer fear getting caught with too little coverage or overpaying for unnecessary add-ons.

Homeowner’s insurance is designed to protect you, the homeowner, from financial damages. A basic policy covers loss or damage to your property (the house and what’s inside it) due to certain events (for example fire or robbery). It also protects you from litigation arising from events that take place on your property (a slip and fall maybe), or damage to someone else’s property (like your dog digging up the neighbor’s prize rosebush).

For this reason, it is vital to have a homeowner’s insurance policy that provides coverage tailored to your individual needs. And since your needs inevitably change over the years (the dog runs away and you buy a lot more stuff) it is prudent to shop for homeowner’s insurance every time your policy comes up for renewal. It may turn out that the company you are does not offer the best deal and you need to switch to a new one. Here’s how.

Step one: Know what you need

Begin by making a list of what you need your policy to cover. Since the housing market has changed so much over the past couple years, you might consider having your home appraised in order to determine how much coverage you need. Also, take an inventory of your possessions, note their value so you can estimate how much it would cost to replace them in the event of a disaster. Highly valuable items such as jewelry, collectibles, and furs may require special coverage.

Next, think about your lifestyle and determine how much liability coverage you feel comfortable with. Standard coverage generally starts at $100,000, however umbrella policies can add $1M worth of coverage or more. The large family throwing frequent birthday parties will likely want more protection than the retiree living alone with few visitors.

Step two: Set a budget

Know what you can afford before you start shopping. This way you can immediately eliminate policies that include a lot of extra bells and whistles that are outside of your price range.

Step Three: Compare

Do not stop after getting just one homeowner’s insurance quote. Collect quotes from as many companies as you can. It might be helpful to contact an insurance broker or to use a website that shops your request for a quote around to several companies. Or if you prefer to visit several of the large insurance companies’ websites, getting a homeowner’s insurance quote from each.

Step four: Purchase

After you have shopped around you may find that the company you are with is just fine, or you may discover someone else can offer you a better deal. Once you have picked a policy it is time to make your purchase. Just be sure that the starting date of the new policy coincides with the expiration of your old one.