Homeowners insurance helps to protect you from losses due to fire, vandalism, burglaries and many other types of damage. Many mortgage lenders require borrowers to secure homeowners insurance, and even those who are not required to obtain a policy should consider its many benefits. As you compare premiums, consider things like type of coverage, deductibles and company reputation to help you select the best policy for your home.
Step 1
Contact different insurance companies in your area and request a quote. Send the same basic information about your home to each company so they can give you pricing based on the same information.
Step 2
Review each policy to understand exactly what's covered. According to Virginia Tech, homeowners insurance policies typically fall under one of eight different categories. For example, while Group 1 policies offer basic coverage, Group 2 policies offer additional protection against some types of weather phenomena. In order to make an apples-to-apples comparison of premiums, you'll need to first make sure each policy offers the same level of coverage.
Step 3
Ask your insurance agent whether premiums change based on payment frequency. According to the University of Missouri, your total annual premium will often be cheaper if you pay once a year because this helps companies lower their administrative costs. Ask how much premiums would be if you make one annual payment versus the cost of paying quarterly or monthly. Use these figures to help you compare premiums.
Step 4
Check the reputation of each company you've received a quote from. Consult your state's attorney general or insurance administrator's website to learn about complaints they've received about certain providers. Check with the Better Business Bureau and even friends and neighbors to find reviews about local insurance companies. A low premium isn't a good deal if the company has a reputation for not paying claims.
Step 5
Confirm with each company whether the premium covers actual or replacement value of your property. For example, an "actual value" policy will pay you the current market value of any goods that are damaged or stolen. A "replacement value" policy pays you enough to actually replace those goods. While replacement value policies cost more, they also allow you to repair or replace your property during an emergency.
Step 6
Compare the deductible for each policy. The deductible is the amount you'll pay each time you file a claim. Your premium will likely be higher with a lower deductible, so you'll pay more each year, but less for each claim. If each quote you've received is different, it may be helpful to ask each company to requote your policy based on the same deductible amount. This can make it easier to compare premiums more accurately.
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