Home Insurance, Catastrophic Coverage, Insurance Agent | Angies List Tips
Homeowners insurance policy stipulations have changed drastically over the last decade. As you shop for a policy, keep the following tips in mind to get the best coverage at the best price.
Take photos and videos of everything in your home. Make copies and send them to relatives or friends, and keep the originals in a safe-deposit box. Keep your policy and important paperwork in a fireproof/waterproof safe.
Find an insurance agent:
- Check Angie’s List reviews and visit the National Association of Insurance Commissioners website, naic.org, to do a company-by-company search for complaints in your state.
- Check insurance companies financial strength with ratings companies such as A.M. Best and Moodys Investor Service. A++ and A+ are the highest ratings; A, A-, B++ and B+ are also secure. Vulnerable companies carry a B rating or below.
- Ask the agent about his or her experience in handling claims. An experienced agent should be able to tell you what to expect if you file a claim.
- If you receive notice of non-renewal, start shopping right away. Consider switching low-risk policies like auto insurance to your new insurer for multiple-policy discounts.
- Check with your state’s Department of Insurance on the statute of limitations for filing a claim, which can vary from one to two years.
- If you experience a sizable loss, consider hiring a public insurance adjuster who will submit claims on your behalf to get the best settlement possible and receive a percentage of your settlement as compensation.
- Don't rely on an adjusters proof-of-loss statement. Use at least three independent contractors estimates as your starting point. Many insurance companies use one-size-fits-all price lists to estimate repairs. These lists often don't factor in higher material costs or higher-end installations.
- Don't assume the insurance adjuster necessarily represents your insurance company or your interests. After disasters, many companies use adjusters from third-party firms to handle the spike in claims.
Get and maintain the right level of coverage:
- Be prepared to spend. The lowest price might not cover you. See: 7 ways to save on homeowners insurance
- Replacement cost insurance covers the cost of replacing your home and is generally the policy for most homeowners. Your agent will evaluate your home and its contents and write a policy that would replace it at that value. Most agents will allow 20 percent to 25 percent more insurance than your replacement cost to cover things like debris disposal and other ancillary costs.
- Read your policy thoroughly, and take careful notes about stipulations, contingencies and situations that could disqualify a claim or compromise coverage and keep them in a safe place.
- Ask specifically about policy stipulations for storm, water, mold, wind and flood. In the past 10 years, companies have increasingly changed the language about these specific items. Ask about adding specific endorsements if your agent or company doesn’t offer the coverage you want.
- If you live in a low-lying or flood-prone area, purchase flood insurance from the National Flood Insurance Program, which offers coverage up to $250,000. If you need more than that, shop around for a private company that offers supplemental flood insurance.
- If you live in California, look into a policy with the California Earthquake Authority, which facilitates earthquake coverage. Premiums and deductibles are quite high but could be minuscule compared with rebuilding on your own after a quake.
- Learn the difference between equivalent and like/kind replacement and find out what your policy offers. It’s a very small difference in the language but it has huge implications. Like/kind replacement means a damaged wood-shingled roof will be replaced with a wood-shingled roof. Equivalent means the replacement roof might not be wood-shingled.
- Get loss-of-use coverage for rent or hotel fees in case your home is uninhabitable after a catastrophe.
- When you get your renewal notice, ask your agent to come back out to review your home and contents. If you've remodeled or bought expensive artwork or appliances, you’ll likely want to increase the value of your policy. And the price of gold has increased dramatically, so you may need to increase your coverage to ensure you can replace all of your jewelry.