Buying a home is likely the single largest investment most people will ever make, so it’s important to protect that investment with homeowners insurance. The right insurance policy can protect you from financial ruin in the event of a fire, theft, or storm damage, as well as legal action brought by injured parties on your property.
With our Best Homeowners Insurance Companies of 2022 ranking, we hope to equip you with the knowledge to select the best provider for your specific requirements. Pricing, policies, additional coverage, application procedures, and filing claims are just some of the many aspects of home and business insurance that we discuss in our reviews and recommendations.
In their new home, a happy family with two kids is having fun. Two young, multicultural parents living in a new home with cardboard boxes with their two sons. Little boys with smiles sitting on the floor with their parents.
Our Best Homeowners Insurance Rating
#1 Lemonade
#2 USAA
#3 Amica
#4 Allstate
#4 State Farm
#6 Nationwide
#6 American Family
#8 Erie Insurance
#9 Liberty Mutual
#10 Chubb
#10 Progressive
#10 Farmers Insurance
How to Pick Your Own Homeowners Insurance Policy
Although choosing the best house insurance coverage could seem difficult, the procedure is actually rather simple. You must first estimate the value of your house and its contents. Next, pick an insurer and policy that offers the coverage options you require at an affordable price.
To buy homeowner’s insurance, take these steps:
1. Choose the insurance coverage you desire. Important jewelry, works of art, and other valuables may not be covered by a typical homeowner’s insurance policy. A trampoline, pool, or other structure on your property that puts people at danger of harm or death may also require additional insurance. You’ll likely need a separate flood insurance coverage from your home insurance company or the National Flood Insurance Program if your home is in a flood-prone area.
Similar to this, you will require additional insurance to cover earthquake-related damage if you live in an earthquake-prone area. To determine how close you are to a fault line and to better understand your risk of experiencing an earthquake, consult the fault map provided by the U.S. Geological Survey.
2. Calculate the amount of house insurance you require. Make a list of your personal possessions. File any receipts you may have. Decide how much insurance you need for your property using this information.
Get an estimate for the typical rebuilding cost per square foot in your location for your home and any structures on your property from your insurance provider or a real estate agent.
Calculate how much you might spend on a hotel, dining out, and other living expenditures if a tragedy caused your home to be destroyed or rendered uninhabitable. You can get guidance from the Insurance Information Institute (III) or a certified real estate or insurance agent as they both have the necessary credentials.
3. Decide on an insurance provider. You should look for an insurer that offers policies with the coverage and other features you require at a reasonable price if you want to select the best homes insurance provider. Additionally, look for a business that receives positive customer and expert evaluations, has a high financial strength rating from AM Best or another rating organization, and enables you to submit a claim or request assistance at any time.
4. Decide on a policy. The ideal house insurance plan will give adequate protection, simple-to-understand terms, and perhaps even discounts. Instead of a cash value policy that just pays the depreciated value of your property, think about getting a replacement cost coverage that will pay for the cost of replacing your property with new things.
Insurance for your car and your home under one policy
Many insurance providers will give you a discount if you bundle multiple policies with them, such as auto and home. Combining multiple insurance policies into one can result in significant savings. The insurance company values this because it increases revenue per customer and strengthens relationships with existing customers.
The savings promised by insurance bundles are not always realized. Amy Bach, a consumer advocate at United Policyholders, claims that insurance agencies that specialize in auto coverage often offer better rates than those that offer a wider range of services. According to Bach, a car insurance company may offer perks like ticket forgiveness or claims-free discounts that aren’t included in bundled policies.
Purchase of Homeowners Insurance
- Decide how much insurance you require. Take a home inventory to determine the amount of coverage you require. An exhaustive list of everything of your personal stuff, both inside and outside your home, is included in a home inventory. Determine how much it will cost to reconstruct your house after a calamity. (Ask a real estate agent about local building expenses.) Evaluate your insurance needs and see if you require additional coverage for high-risk items like a pool, floods, or earthquakes. The Insurance Information Institute (III) and a certified insurance agent or real estate agent can both guide you through the process if you need assistance figuring out how much house insurance you require.
- Choose between real cash value and replacement cost coverage. You may have the choice to choose your method of reimbursement when purchasing a coverage.
- Depreciation is not taken into account while issuing claim payouts under replacement cost plans. For instance, if your house burns down and needs to be rebuilt, your insurance would pay for the expenses of comparable-quality materials, even if the cost of those materials has gone up since your house was built.
- According to the depreciated value of the damaged item, actual cash value insurance provide payouts. The cost of materials less depreciation, in the previous example, would be the amount your insurer would compensate you for. This amount can be lower than the real expenses to rebuild your home.
- As a result, although though replacement cost policies have slightly higher rates, the majority of insurance experts advise purchasing one.
Focus your search on a few house insurance companies. It’s useful to consider the following while you evaluate your options:
Types of coverage and features
- Options for policy management (e.g, online, mobile app, agent)
- You could require additional types of insurance, including auto insurance.
- both expert and customer reviews
- You can remove businesses that don’t fit your specific needs by taking into account these factors up front.
Compile a collection of quotations. Use the quote tools provided by the companies you’re considering to get an idea of how much money you’ll need to pay for the necessary insurance. A conversation with a live representative, either in person or over the phone, can be very helpful right now. Get quotes from multiple providers, but only compare policies with similar coverages.
Get in touch with the company early on to initiate the application process. As was mentioned in the previous section, the way in which you communicate with the company will change.
Some homeowners insurance companies may require an inspection of your property as a condition of coverage. If an insurance company deems it necessary, they will send an inspector to your home.
As a result of COVID-19, many insurers have modified their inspection practices to ensure compliance with safety regulations, such as the use of personal protective equipment and the maintenance of social isolation. In some cases, the homeowner isn’t necessary for the inspector to check the exterior of the house, roof, and any potential hazards in the yard that could cause damage to the house in the event of a major storm.
Some companies, however, will pay special attention to the state of your home’s plumbing, heating, air conditioning, fireplace, ventilation, and other systems. Prior to purchasing home owners coverage, it’s a good idea to research the insurer’s standards and ask how often they conduct home inspections.
How to File For Homeowners Insurance Claim
To submit a claim for homes insurance:
1. If required, submit a police report. The Insurance Information Institute advises making a police report in cases of theft, vandalism, and break-ins. Keep a copy of the report you submit, and keep a list of all the law enforcement personnel you speak with. You can submit a police report online in some cities, like Austin, Texas.
2. Inform your insurance provider as soon as you can. Depending on your coverage and the insurer, you can do this online, through the company’s mobile app, or over the phone. This will simplify your claim and increase the likelihood that you will receive payment quickly.
3. Damage to documents. When possible, record any damage with pictures or a video. Make a thorough list of everything that was taken if you’re making a claim due to theft. It’s also a good idea to include any additional details that might be relevant to your claim. If you have security cameras, gather and give your insurance company the footage.
4. Perform any necessary repairs. Make any urgent repairs or those required to protect your home from further harm after the damage has been documented, presuming you can do so safely. The III advises preserving receipts for any items you buy and holding onto replacements for damaged materials until your insurance company adjuster has looked them over. Wait until the adjuster has seen the damages before making any permanent repairs.
Home Insurance FAQS
What is insurance for a home?
A type of insurance called “homeowners insurance” protects you financially if your house or belongings are damaged. The policy makes it clear what buildings and things are covered, to what extent, and under what conditions. It also says how much of a deposit you must make before the insurance policy starts to pay you (this is called a deductible).
For example, a policy might say that a $1,000 deductible only applies to the first $300,000 of fire damage to your property. This means that after you pay the $1,000 deductible, the insurance company will pay you up to $300,000 to fix or rebuild your home if it is destroyed by a fire.
Also, most standard plans will cover your personal belongings up to a certain limit, provide some liability coverage in case you are held responsible for someone getting hurt on your property, and cover loss of use. When a covered event makes it impossible for you to stay at home and forces you to book a hotel, loss-of-use coverage gives you money to pay for the hotel. Loss-of-use coverage pays you back when a covered event keeps you from staying at home and forces you to find a hotel.
Does a homeowner need insurance?
Most homeowners should get home insurance, even if their mortgage lender doesn’t make them. Home insurance is one of the best ways to protect your biggest investment, your home, but many mortgage lenders will make you buy it to protect their own financial interests.
Even if you have enough money to fix or replace everything in your home in the event of a break-in or fire, homeowners insurance is a cheap way to avoid having to pay the astronomical out-of-pocket cost.
Check out our What Does Homeowners Insurance Cover? guide and our article on Local Homeowners Insurance Companies to learn more about homeowner’s insurance and to find out which state has the best insurance for homeowners.
What does homeowners insurance pay for?
Your property is protected by homeowner’s insurance in case something bad happens that you didn’t see coming. If something bad or even terrible happens to your home, like theft, vandalism, storm damage, water damage, or a fire, a homeowners policy will pay to fix or replace your home or other buildings, like a garage. Your insurance policy also covers things like clothes and furniture that you keep in your house or on your property.
If a visitor gets hurt on your property, the insurance will also protect you from being sued. If they sue you, the coverage will pay for both their medical bills and your legal fees. A standard homeowners policy will also pay for things like a hotel room and dinners out if something like a fire makes your home unsafe to live in.
Lastly, home insurance can cover things like swimming pools that increase a homeowner’s liability risk or high-value things like fine jewelry, even though they usually cost more.
Before you buy an insurance policy, you should talk to a representative from the company about your needs so that you can get the best coverage at the best price.
What is insurance against risks?
Hazard insurance, which is also known as housing insurance, is usually part of a standard homeowners insurance policy. It pays to fix or replace the structure of your home if it is damaged or destroyed by one of the named risks (also known as the “hazard” in hazard insurance). If you have a mortgage, you may be required to carry a certain amount of risk insurance as part of your overall home insurance policy.
Some known dangers, such as those listed below, could cause damage to your property.
- Fires \sExplosions \sVehicles
- Hail \sLightning \sTheft
- Vandalism
- dead trees
- Flooding and earthquake damage are not covered by hazard insurance. For each of these catastrophes, you will likely require a different insurance, and the level of coverage will depend on your location and the insurer.
In what range does home insurance typically fall in terms of cost?
Our sample policy’s monthly premiums were quoted by the companies in our rating at a range of around $100 (for a policy with Erie Insurance) to $170 (for a policy with Allstate). Estimates for homeowners insurance are based on a number of factors, including the location of the property, its size, and the level of coverage desired. Check out our helpful resource, Homeowners Insurance Quotes, to learn more.
Whether or not damage to your home is caused by flooding, will your insurance company pay for it?
Common homeowner’s insurance policies do not typically include coverage for flood damage. Your home’s potential flood risk can be determined by visiting the FEMA Flood Map Service Center website and entering your address. Many of the insurance carriers we evaluated offer policies that comply with the National Flood Insurance Program (NFIP).
Do fires get covered by homeowner’s insurance policies?
Most home insurance policies cover losses due to fires. Wildfires are typically included as a covered peril under this policy. If you live in an area prone to wildfires, review your insurance plan.
If you want to know if your neighborhood is at risk from wildfires, you can do so by visiting the Wildfire Risk to Communities website. This tool was developed by the USDA Forest Service.
Is earthquake damage covered by homeowner’s insurance?
In most cases, earthquake damage is not covered by a standard homeowners insurance policy. Earthquake-related damage is not covered by standard property insurance. A large number of the companies we ranked offer earthquake insurance, including several of our top picks like Lemonade and Amica (although Lemonade only offers this coverage in California).
FEMA maintains seismic hazard maps that can show you the frequency and severity of earthquakes in your area.
Does homeowner’s insurance pay for storm damage?
The answer to this question is conditional on the details of your insurance policy and the nature of the damage. Hail, wind, and lightning are all typically covered under a standard policy. Flooding caused by a storm (such as the storm surge in a hurricane) is typically not covered by standard policies, but is covered by flood insurance.
While most insurance policies will cover the costs associated with a windstorm, some may have restrictions or require a higher deductible in the event of such an event. The same is true for homes located in areas where hurricanes are common.
How does mold affect homeowner’s insurance?
Whether or not mold damage is covered by insurance usually depends on what caused it. According to the III, mold is typically not covered unless it is the direct result of an insured peril, such as a burst pipe. And even then, there is no guarantee of coverage. In order to determine whether or not mold damage is covered by your homeowner’s insurance, you should review your policy’s language or get in touch with your provider.
Are premiums paid for homeowners’ insurance tax deductible?
Even if your primary residence is insured, the cost of premiums is not deductible by the Internal Revenue Service. But you can get a tax break for the cost of rental property insurance. In addition, if you do your job full-time from home, you may be eligible to deduct a portion of your home insurance premiums. You may be eligible for a tax break if you have a roommate or rent out a portion of your home to a tenant.