Home Insurance Companies: How to Pick The Best One

Trust us: you need homeowners’ insurance. Here are some common complaints you hear about property damages: 

  • “My house was destroyed by a tornado.”
  • “The flood damaged my household.”
  • “My home was hit by lightning.”
  • “I lost my roof due to the hurricane.”

Most of the time, you don’t worry after hearing these stories because these disasters don’t take place where you live, or they may be not even true! 

  • “I lost everything because a fire broke out in my apartment.” 
  • “The thieves took my watch collection, TV, laptop, jewelry, tools — everything. Even my personal belongings.”  

What do you think? Sounds more realistic, right? 

You can hear such statements anywhere (even in your neighborhood), not just on the news. So, if one of these calamities happened to you, how would you feel? Let me paint two different pictures of your potential emotional state while experiencing such a tragedy.

Piece of My Mind or Peace of Mind? 

These two phrases are entirely different from each other. They require two different approaches to life. One of them is approaching life as an adventure; the other one is seeking security. One cares about today, and the other cares about tomorrow.

Neither is better than the other, just different. 

The truth is, you never know what can happen tomorrow. Something can come up from nowhere just as easily as nothing can happen for several years. You can choose to live without homeowners’ insurance if you want to roll the dice. 

Have You Ever Imagined Life Without Homeowners’ Insurance? 

“A tree fell onto the roof of my house and caused enormous damage. A new roof will cost me $4,000. I don’t know how to pay for it. My savings are reserved for my son’s education. I feel destroyed and don’t know how to tell my son that I don’t have the money to pay for college.” 

“An earthquake caused $50,000 worth of damage to our house two years ago. When it happened, my friend opened his doors, so we had a place to live while we repair the house. However, we haven’t been able to afford to finish all the work yet. We are still living with them, which is, honestly, uncomfortable for everyone. I feel miserable and exposed.”  

How About With Homeowners’ Insurance? 

‘We lost our house last year in a fire. We felt overwhelmed because of the loss and all the work we put into the house. It was a tough period because all our plans for the following months ended up in smoke (literally). The good news, however, is that we went to a hotel during the repair process. The home insurance company refunded all our costs, including reparation and additional living expenses. We made the best of our weeks-long hotel stay ← we treated it like a second honeymoon! But, I can’t deny how happy we were to get back to our restored home once it was finished.”

In the first case, you probably would like to give to the universe a piece of your mind about that shameful episode that caused such frustrations and loss in your life. In the second case, you can enjoy peace of mind.  

Need Further Convincing?

Statistics regarding household damages speak for themselves, and the ways problems can occur are alarming.

From burglary to fire, vandalism, hurricane, lightning, theft, earthquake, and flood, plenty of bad things can happen to our house, and we can neither predict nor prevent what will go wrong in most cases. The exception being incidents that occur due to the homeowner’s mistakes or neglect.

Did you know that 18,000 Americans die in household accidents every year? Did you know that more than 3.4 million children get injured at home every year? There is a broad range of reasons that include falls, burns, poisoning, suffocation, unsafe storage of medications, and many more. You can prevent these kinds of unfortunate events by taking certain precautions, but what about accidents or disasters that happen out of your control? 


Did you know that 2.5 million burglaries take place in the United States every year, according to Protect America? Did you also know that, from this amount, 66 percent are home break-ins? You shouldn’t be surprised about this figure since theft is the most common crime type in the world. See what else the Insurance Information Institute suggests about home invasions. 

Water Damage

Water damage is so typical that almost every home is expected to experience at least one water issue in its lifetime. It can occur for several different reasons, including natural disasters or a plumbing failure. Water damage statistics say that home insurance companies receive more and more water damage claims from their customers than any other. 


Damage from a fire is also widespread among household claims. According to the National Fire Protection Association, a fire department was ready to respond to a fire every 24 seconds in 2017. 


Do you believe that your home never will get struck by lightning? You are probably right, as it’s extremely rare, but still, take a look at the statistics. According to the National Weather Service, from 2009 to 2018, 27 people died from lightning strikes in the U. S. If your house is struck, the biggest concern is fire, and your homeowners’ insurance will likely cover it.  

To Insure or Not Insure?

So, we explained that you have two alternatives, but only one of them can be the winner. If you have a family, responsibilities, properties, or you are a homeowner who loves their home and doesn’t want to lose it, make the right choice, and insure your home. 

But what if you don’t think you can afford to pay the premium of the insurance? Fortunately, many casualty insurance companies offer a variety of options to provide insurance coverage on your properties at a reasonable price. 

We put together a list containing the best home insurance companies so that you can have the most prominent names in your mind. But we’re not stopping there!

We are aware of how complicated it is to pick the best fit. That’s why we have gathered all the relevant features you would need to know if you are shopping for an insurance provider for your property. 

But before delving into our subject seriously, let’s take a glance at the meaning of home insurance and other related points you should be familiar with.

The 7 Things You Must Know Before Choosing a Homeowners’ Insurance Company 

Home insurance is a multi-risk insurance product that meets all the needs related to home protection, and it was created to protect one’s family and property from any calamity. Providers usually supply property and casualty insurance.

In the event of property damage, you can file a claim to your insurance company; they will send an adjuster to come and personally examine your request, and if approved, the company will pay for your losses.  

Home insurance providers also provide liability insurance in case of personal injuries of third parties on your property. 

Types of Coverage Provided by Homeowners’ Insurance Companies

All this insurance talk seems complicated, but actually, it can be simplified in this way:

Your homeowner’s insurance must provide three chief areas to cover your loss or liability related to your asset. 

The first is your home’s physical structure, which is known as dwelling coverage. This includes electrical wiring, plumbing, central air, and the heating system. These are considered” open perils,” which means the property is covered from all causes except those that are specifically excluded from your policy. The second coverage is supplied for other structures of your property like fences, sheds, driveways, and electronics. These are also ‘open perils.’ The third one is for personal property or personal belongings that are covered even when they are located on someone else’s real estate. These are called” named perils,” which means only specific reasons listed in the policy are covered

Beyond these three main fields, they cover other losses such as loss of use. Practically, if you need to stay in a hotel room, you will get paid while you cannot live in your home. This kind of covered loss is the so-called additional living expenses. Most companies pay for your financial losses in case someone gets hurt on your property and brings legal charges against you. It is called personal liability coverage. 

I imagine you have a lot of questions in your mind! Let me guess some of them! 

“Does homeowners’ insurance cover water damage, fire damage, tree damage? 

“Is there flood insurance?”

No rush! We’ll get there, but if you want to dig into the types of insurances right now, you can find a useful guide of what homeowners insurance covers here. 

What Homeowners’ Insurance Does Not Cover

With only a general policy, you will unlikely be paid for damage or losses caused by flooding; you will need to purchase flood insurance if you think your properties might be exposed to such a danger. 

Plus, keep in mind the wear and tear exclusion. It means the home insurance company won’t pay for the expected deterioration of the insured object. 

Key Factors to Consider While Choosing Your Home Insurance Provider

Warning! A signature is not enough to protect the house from theft and fire. During your selecting process, be careful about the amount to be insured and know that the insurer will not always pay your claims.

Next, do your research. Make sure to have enough information about what your potential insurance policy will cover. Read the insurance policy and the contract carefully, so the policy meets your needs and is suitable for each specific case. 

The first mistake to avoid is to try to save money by giving up fundamental coverages for the sole purpose of paying a lower premium. Instead, look for the combination of complete guarantees and the best price. 

There are two essential terms that you should encounter while studying the insurance policy: premiums and deductibles. 

What Do Premiums and Deductibles Mean?

To put it simply, the premium is what you pay for insurance coverage. Now, the question is how much you will pay in exchange for this service. The amount of money varies depending on a wide range of factors, starting with the policy. 

What will your insurance company consider for establishing your particular premium? If you were the insurance agent, you would like to know what risk you will take by making a deal with your potential policyholder, right? So, you would analyze the risk factors; in other words, how likely your customer will file a claim to take advantage of the coverage.  

A deductible is another fee. Every insurance agency and company requires this kind of cost. The difference between premium and deductible is that the latter must be paid only when you file a claim. Let me give you a specific example: if your deductible is $ 500, you need to spend this amount out of your pocket before insurance will pay. So if your expenses are only $300, you will have to foot that bill. In case your costs exceed the $500 mark, you have the right to get paid by the insurance company for any amount over the deductible.

To sum it up, a higher deductible usually equals a lower premium and vice-versa. You need to figure out which one fits better to your situation. 

How Much Does Homeowners’ Insurance Cost? 

The answer to this question depends on many factors, as is usually the case in the insurance world. Homeowners’ insurance companies usually calculate insurance rates based on where you live. You would pay more for insurance where more hurricanes, tornadoes, earthquakes, and other natural disasters typically take place. For example, if you live in Florida, you will pay more than your friend who lives in Vermont.

I know you’re saying, “Fantastic! But how much insurance will I pay?” I know, I know… I was also searching for this answer desperately before I purchased my home insurance. And you know how I discovered the exact price? When I sat down with my agent, who examined my case. Since every situation is different, every home is different, and every company is different (and even plans inside the same company differ), so you will find various options.

Here are some numbers to have an idea about an average home insurance cost by state:  

Thanks to its vast amount of coastline, Florida is the most expensive state, with an average premium of $3,575. Louisiana is next, with an annual rate of $2,979, while you can find the cheapest one in Hawaii, where an average insurance quote is only $337 per year. Find more figures here. 

I want to highlight that the cost varies based on many factors. For instance, you need to calculate how much insurance coverage do you need.

How Much Insurance Coverage Do I Need?

If your property is severely hit or destroyed, you will probably want to cover all your future costs to rebuild your home.

You have some alternative coverage options to consider.  

  1. Actual cash value: This means you will be paid for the real value of your property at the time it was damaged. Calculate the actual cash value of your home here.
  2. Replacement cost: Usually, this is better protection for your asset since it implies that the insurance provider would have to pay the costs of rebuilding without applying depreciation. Calculate the replacement cost of your home here. 
  3. Extended value: This option indicates that your provider would pay you up to 20 to 30 percent over your coverage limit. 

Now that you are educated on your options, it’s time to answer the big question: what is the best home insurance company?

The Top 8 Homeowners’ Insurance Companies in the U.S.

What is right for you, it’s not necessarily suitable for someone else. Why? Simply because your needs can vary based on aspects like location, property type, value, risk factors, and more.

Your unique home will get a unique insurance policy!  

Even though we listed only eight companies in this article, we are aware that the home insurance market is full of firms, agencies, and other providers. This is just a brief look at the most relevant players in the marketplace.

Let us draw your attention to something crucial before you pick your match: a comparison.

Everything needs to be compared. Compare policies, insurance rates, coverage limits, premiums, deductibles, discounts, bundling options, availabilities based on location, customer service, customer satisfaction, financial strength, handling claims, ratings from consumer reports and related studies — in other words, everything!

Amica Mutual

“Helpfulness insured.” 

When you need a hand finding your way through the maze of insurance processes, Amica Mutual gives it to you.  

When you do your first search on home insurance companies, you will find Amica among the first hits on Google. That’s not only just because they are good at SEO and other marketing strategies; it’s because they are consistently ranked among the best insurance providers. 


Amica Mutual is famous for its insurance policy offers, policy information, billing process, customer service, handling claims, and (last but not least) the highest customer satisfaction. They have a 95-percent retention rate, which means that their clients are so satisfied that they don’t leave their company.


J.D. Power’s 2018 U.S. Survey has rated Amica Mutual at the top for the 17th-straight year. Why? Because of its superior performance in almost every relevant aspect regarding the insurance industry. This insurance company received an A+ rating from A.M. Best Company for its ability to claim payments and for financial strength. Check out what customers have to say about Amica!


What can be a significant benefit for you while considering having a policy with Amica Mutual is that it’s a mutual insurance company. That means that its policyholders own the company. Why is it a good thing? Because it distributes dividends to its policyholders if you purchase a dividend policy. 

Is This What You Were Looking For?

If you own other properties (i.e., a car), Amica Mutual is perfect for you. You can combine your home insurance with auto insurance, and you will get a discount. Besides, they give you a discount for loyalty after just two years of membership.

Erie Insurance

Their founding purpose and history are touching: “To provide our Policyholders with as near perfect protection, as near perfect service as is humanly possible, and to do so at the lowest possible cost.”


Erie Insurance is the ninth-largest homeowners’ insurance company in the U.S. 

What they are good at is their prices. Their consumers say it, so it truly means something! They say that Erie has a reasonably priced policy based on their customers’ level of coverage. Their coverage options are more extensive than usual among U.S. insurance companies.

They are real and very human. When you decide to make a deal with Erie, you will have an independent personal agent whom you will interact with during all the processes you are going through. Your agent will support you, even if you need help on Sunday evening! They rate highly in customer service as well, since they provide 24/7 assistance.  

Erie is also unique because they genuinely try to meet your requests by adjusting their policies. For example, if you have basic homeowners’ insurance, you can add extra coverage for other natural disasters that may affect your home. You can even add coverage for your valuables.  


It is competing at the quality of services with Amica Mutual in the 2018 J.D. Power survey, as Erie Insurance also received high marks. Erie ranked 3 out of 5 stars in each category, which is not bad at all. 

It received an A+ mark from A.M. Best thanks to its financial stability. Check what customers say about Erie!


Here comes the best part — they are among the cheapest and best insurance agencies in the country. So, I sense, we are on the way of finding the best fit for you. 

Or Is This What You Were Looking For?

However, you have to check if they provide service in your area, as they do not do business across the entire country.

(Here’s an extra tip: interact with them offline! Their online options are a bit more modest compared to their competitors.) 

 State Farm

“Get to a Better State.”


Are you looking for the cheapest rates for your eventual homeowner’s insurance policy? Here we go; we found it! State Farm makes coverage available for everyone with its affordable price policy. So, you can get to a better state!   

It offers the most economical solutions when it comes to insurance quotes, and it’s arguably the most famous American insurance company. State Farm also does business nationally so that you can find them in the entire U.S.

State Farm also gives you the chance to bundle different policies. The more you bundle, the more significant the discount you get. For instance, you can choose higher deductibles and consequently, lower annual costs. 


J.D. Power thinks they are excellent since State Farm got higher ranks than average in the relevant classes of their 2018 survey. Besides, it received a superior score (A++) from A.M. Best Financial Strength Rating.

Their consumers are satisfied, so what else you need? The company is rated sixth out of 29 companies according to the J.D. Power survey for their insurers’ service, policy offerings, affordable prices, and claims handling. They are also strong financially, as they gained an A.A. rating from S&P Global Ratings for their financial strength. Check what customers say about State Farm!  


State Farm cares about their customers. It built up a vast network of insurance agents who provide useful assistance when required. They also have a lot of supportive online resources. 

Not Sure Yet? 

If you prefer to personalize your plan, you’d rather look for another company. Moreover, if you need special protection for your property, State Farm is not the best solution, since they have limited endorsement options. 


“You’re in good hands.” 

If you seek to cover all the bases, Allstate may be the choice for you.


It is the second-biggest national insurance company after State Farm in America, but Allstate stands out with coverage options and resources. 

Allstate, like its competitors, offers several options to personalize coverages and tailor the policy to its customers’ needs. It is better than most other insurance firms at customization options. For example, you can add extra coverage for the cost to rebuild your home, identity theft protection, floods, earthquake, fire, water backup damage, mobile and manufactured home coverage, and so on. Put simply, it provides more control to homeowners over their insurance issues. 

Allstate is reliable with its online service since you can file claims and pay premiums online throughout their online platform. It’s perfect for new homeowners because their insurance agents honestly keep up with the needs of their customers. Allstate’s customer satisfaction score is not as high as the other leading home insurance companies, so that would tell you that their customer service needs improvement.


It is also ranked above average in J.D. Power’s Home Insurance Study in all categories. A.M. Best gave Allstate A+ for financial strength. Check what customers say about Allstate!


Anything special? Yes! Generally speaking, more discounts are available in Allstate than in other companies. They have a very sharp so-called Claim-Free Bonus feature for those who have not filed a claim during the year by offering exclusive savings and discounts for them.  

Are you a new homeowner or hunting for a new house? Do you not have any idea about home insurance issues, companies, terms…anything? Don’t worry! Allstate will equip you with educational resources and give you tips for policy personalization. 

So, Finally Found? 

To sum up, Allstate is suitable for you if you are a new homeowner, but it’s not the cheapest option in the market. However, let’s remind ourselves that the cheapest is not always the best.

Farmers Insurance

As it comes with their slogan – “We know a thing or two because we’ve seen a thing or two,” Farmers Insurance is all about personalization!


Farmers provide services in all 50 states across the U.S.

Farmers Insurance is for those who prefer to personalize their chosen product due to its outstanding custom options and customized services. It offers three packages of coverage: standard, enhanced, and premier. Even the basic packages contain sufficient features for different needs, and you can add more custom options.

The standard level is for starters who don’t have unique and particular requirements. The two remaining are the upgrades of higher coverage limits and additional features. Consequently, if you purchase the premium level, you will have the highest limits on coverage and personal property, in addition to guaranteed replacement cost coverage.


Farmers received an excellent ranking in J.D. Power’s Home Insurance Study for all categories and an A score from A.M. Best for its financial strength. 

Good at customization, but not at customer service! Even though they provide 24/7 service, they are ranked only as average in J.D. Power’s customer satisfaction rankings for customer service, claims to file, and claims payouts. Check what customers say about Farmers!


Claims-free terms deserve special gifts! Farmers award their consumers with special discounts in the event they don’t file a claim. Clients can also turn deductibles for the benefit of themselves since the company may refund $50 each year if the policy is suitable. 


 “Nationwide is on Your Side.”


Nationwide is a mutual insurance company, but it offers “more than just insurance.” It has retirement, investment, and banking services as well. However, it is mostly known for its outstanding replacement cost coverage.  

Nationwide provides general and standard insurance services that you can find elsewhere too; however, it comes with some exciting features! For example, if something terrible happens to your personal property (destroyed, stolen, etc.), the firm will pay you so a fresh one can replace your old item! It’s fantastic! So, doesn’t Nationwide evaluate the actual value of your stuff, but presents you a brand-new item with no questions asked? In practice, yes! 

Pleasantly, the company supplies several useful educational materials, online resources, and helpful tools that make the process of filing a claim more straightforward.  


The company took an average rating home from J.D. Power in every category, but what makes the company powerful is its financial stability. It received very high scores for financial strength, which is a big deal! Check what customers say about Nationwide! 

Fewer customer complaints are registered than most insurance companies generally receive, even though its customer satisfaction ratings are right around average. On the other hand, they have many advantages like fast responses, easily reachable agents, and quick payments. 


There is another very kind thing they do. Do you want to replace your roof with new, more robust materials? Go ahead because Nationwide will refund the costs! 

If you want, you can also get additional coverage for your valuables to protect them. 

Will you keep searching, or have you already found your policy? Nationwide is recommended for new homeowners with high-risk factors, along with fans of bundling.

The Hartford

 “Green, environmentally friendly materials or processes for repairs and rebuilds.” 

The Hartford offers all the above.  


Their strength is a plus because it’s something you cannot find elsewhere. 

This company works better for those who want their house to be green and environmentally friendly. They offer abundant coverage options, a wide range of discounts, and a unique endorsement for green rebuilding. Beyond “being green” though, they don’t have many exciting discounts to add.

So, you must like the idea of a green environment and green buildings if you turn to them. In this case, you can be happy because your company will raise your policy limits by up to 10 percent!

The Hartford furnishes pleasing customer service and got quite good marks at customer satisfaction as well. 

However, they provide insurance services mainly for members of the American Association of Retired Persons (AARP) as they have an official agreement. But if you’re under 50 years of age, don’t worry! They have independent agents who will do their best to offer you a solution. 


The firm has a superior rating (A+) for financial strength. You can be quite sure they can afford to pay you after you file a claim (if everything meets their requirements, obviously). Check what customers say about the Hartford!

Are you considering owning a greenhouse?


 “Snap it in. Drive Safe”


Well, yes, Progressive is better known for cheap car insurance, but they do offer homeowners guarantees for their customers. It suggests you can purchase your desired home insurance through the company. Before buying, check what kind of coverage and service they provide in your state as they can vary.

Their working method is different from the most home insurance companies you find in the market because they rely on other firms and agencies. Why is it important? Because in reality, these partners will fix the rates you should pay and process your claims. Progressive declares on its official website that its partner insurers can decide the prices, coverages, and privacy policies. 

Check what customers say about Progressive!   


Customer service is also the reason for their built-in quote comparison ability that makes them the best at online home insurance quotes. Though this is also a reason to pay more attention offline. Check what a specific Progressive partner can offer you in your location. Take a look at the ratings, customer reviews, financial scores, and discount opportunities.

Is this Your Match?  

Progressive can be recommended for those new homeowners who are looking for basic coverage options.

We would like to see the reason why you picked a specific homeowners’ insurance company. Please feel free to share your thoughts with us in the comments section.

Tricks for Finding the Best Home Insurance on the Market

Your home is one of your most valuable assets. One of the most basic needs in our society is to have a roof over your head. But what if something happens to your home? You want the assurance that you’ve got it covered, don’t you? You need to be able to repair damages, replace valuables, or rebuild without having to dig too deep into your pockets. That’s where having the best home insurance becomes a valuable investment.

You protect your home against predictable wear and tear through routine maintenance and by replacing worn equipment. But, the majority of household insurance claims made are not predictable. Trends show that extreme weather conditions cause most home damages. When it comes to your home, don’t you want to prepare for such unforeseen circumstances?  

Good home insurance offers you the peace of mind that your family, your house, and your belongings are covered. But before you choose a policy, it’s essential to understand what home insurance is.

What is a Homeowners Insurance?

Damage to your property is a terrifying but real possibility. Considering that we can’t predict everything that will happen, it’s vital to prepare for the “what ifs.” Homeowners insurance is coverage that protects you from the unexpected expenses of property or personal damages, and, if you have a mortgage, you may be required to insure for at least 80 percent of the home’s replacement value.  

Home policies are very much like car insurance, where you pay an annual premium, choose a deductible, and decide on different coverages. In the event of filing a claim, you receive a lump sum to use towards repairs, replacements, or personal damages.  

Be aware that policies differ, and not all damages are necessarily covered. Consider, for example, the difference between named peril policies and open peril policies. “Peril” is the term used to designate the cause of your losses and may be specified in some plans.

Named (Covered) Peril Policies

This type of policy lists exactly the perils included in your insurance policy. In choosing home insurance, you should know what is covered in the terms and conditions of your homeowners’ insurance policy and make decisions about coverages you might need that are omitted.

The most common events included as named perils are: fire, smoke, explosion, lightning, wind, hail, vandalism or riots, and certain types of water damage. Depending on your insurance provider, you may also be able to specify other perils, such as burst pipes.

In a named peril insurance policy, your company will not cover any peril that occurs outside of the agreed-upon list. When filing a claim, you might have to dispute whether the loss occurred due to a named peril. You, as the policyholder, will need to provide proof that your insurance should cover the loss.

Often, named peril policies tend to be less comprehensive than open peril insurance policies.

Open Peril Policies (Comprehensive Risk Coverage)

Open peril policies will reimburse you for just about any loss regardless of how the loss or damage occurred.

There are, however, exclusions listed in the terms and conditions of the policy. They may include events such as war, floods, and nuclear hazards. Your insurance policy will not cover events that are mentioned in the exclusion clause.

Open peril policies tend to be the most popular type of coverage. If you live in a higher risk location, an open peril policy is probably a better way to go. But because of the extended nature of the coverage, open peril policies tend to be a more expensive option.  

In addition to considering perils, there are other terms you may encounter in researching home insurance that you should know so that you can make the most informed choice.

What’s the Difference Between HO2, HO3, and H05 Insurance Policies?

You might come across the terms HO2, HO3, and HO5 when researching homeowner policies. Here’s what it means, in a nutshell:

HO2 Policy

This is the most limited and basic version of your homeowner’s insurance policy. One version of the HO2 policy covers the Actual Cash Value (ACV), which is the depreciated value of the lost item covered. An HO2 policy with replacement cost coverage will provide coverage equivalent to the value of the loss.

Some of the named perils included in HO2 policies include fire, lightning, windstorms, hail, freezing, vandalism, smoke damage, volcanic eruptions, and personal liability cover.

HO3 Policy

This policy is a much more comprehensive option. Unless expressly excluded in your insurance policy, all peril is covered by the HO3 policy.  

Possible exclusions include events such as war, nuclear hazards, floods, earthquakes, water damage, and earth movement.

The HO3 policy only provides coverage on named perils. 

HO5 Policy

The HO5 policy offers the most comprehensive coverage. An HO5 policy will cover all items at the replacement cost if you experience damage to your home or its contents. This only applies to a named peril. The HO5 policy includes all events or items covered in the HO3 policy as well.

Earthquakes and floods are not included, as with most homeowner policies. Obtaining coverage for earthquakes and floods is usually available as additional insurance or “Endorsement.”

It is just vital, of course, to know what a policy does cover as what it doesn’t cover.

What do homeowner’s insurance policies typically cover?

We all have different needs. Therefore, you must compare different homeowners’ insurance companies when shopping for the best policy. You need to find an insurance policy that meets your needs and provides you with the best rates. It is also essential to understand how the company handles claims. So, what are the common coverages?

Typically, you will find four different types of coverage:

  • The actual property (dwelling coverage)
  • The contents (personal property coverage)
  • Legal liability coverage
  • Loss of use (additional living expenses coverage)

Dwelling Coverage

This part of the insurance policy protects you against damages to your home’s physical structure: Walls, floors, windows, ceiling, and roof, as well as the foundation. Often the policy may also include other fixtures, such as plumbing, air conditioning units, electrical wiring, and appliances that are built-in or attached to your home’s structure.  

Dwelling coverage also protects attached buildings, including garages, patios, sheds, and decks. A Dwelling coverage policy does not cover detached structures.

When shopping for Dwelling coverage, you should look for a policy that will fully cover rebuilding (home replacement cost) or repairing damage to your house. You should have sufficient insurance to cover the labor and materials required to rebuild your house completely. When speaking to your insurance policy provider be sure to mention essential or unique features of your home so that they are covered in the replacement cost as well.

The cheaper option in Dwelling coverage is an “actual cash value” policy. Such a policy reimburses you for damages based on the depreciated value of your property from aging and wear and tear. The coverage will probably be less than the original purchasing price and means that a portion of repair or replacement cost will come from you.

Content Coverage

Content coverage is also known as “personal property” or “possessions coverage.” This type of policy covers only named perils. It includes damages or loss to personal belongings kept within the structure of your home.  

In a content coverage policy, you receive protection against loss of contents, such as furniture, décor, electronics, appliances, and clothing. Depending on your insurer, other high-value items, such as jewelry, may only be covered up to a specific limit. For these high-value items, scheduled personal property coverage is an option with some insurers. It does, however, come at additional cost.

Much the same as with Dwelling coverage, Actual Cash Value (ACV) coverage typically applies to these higher-value kinds of items. In this case, with ACV, you can expect an increase in your policy rates. When claiming for loss or damage, an ACV policy will reimburse you for the current value of the item (less the depreciation). 

Although it comes at a higher rate, Replacement Cost coverage will reimburse you for the original value of your personal belongings.

Legal Liability Coverage

Liability coverage will protect you if harm comes to other people while on your property or if damage occurs to their property due to your negligence. It is one of the most flexible coverage options as it responds to various perils.  

If you are sued for multiple assets, umbrella (or excess) liability coverage will give you added protection for assets such as investments, real estate, or personal property. You should invest in coverage that matches the value of your assets.

Legal liability also covers medical expenses for guests on your property and any cost incurred by a lawsuit against you. Liability coverage is often subdivided into personal liability and medical costs for other parties.

Loss of Use

Loss of use coverage is also known as “additional living expenses coverage.” It will reimburse you for any cost that may occur while you cannot inhabit your home. That is, if you suffer damages or loss to your property, which require repairs covered by your property insurance policy and are unable to stay in your house while repairs are made, you can claim the cost of additional expenses such as alternative accommodations with a loss of use policy.  

Depending on the coverage, your insurance policy may provide you with daily compensation to spend on additional living costs. Other “normal” expenses are not covered.

Additional Coverage or Endorsement

Besides the four main coverage options, some companies offer more specific additional options. It’s best to evaluate your particular circumstances and whether adding these endorsements to your existing home insurance policy is a wise choice for you.  

Some of the most common additional (supplemental) coverage features offered by a “good” insurance provider include:

Sewer backup coverage, which covers water damage to your property due to sewer backups.

Earthquake, hail, and windstorm insurance covers damages caused to your home due to earthquakes, hail, or strong winds. Depending on your insurance company, this could be a standalone policy or an addition to your existing home insurance.

Flood insurance covers damages caused by floods. This policy can be purchased directly through the National Flood Insurance Program (NFIP) or your insurance company.

Inflation guard protects your property’s damage or replacement costs from changing value caused by inflation.

Scheduled personal property covers the full replacement cost of your valuables. Commonly insured items include jewelry, furs, art, antiques, stamp collections, coin collections, firearms, musical instruments, and other expensive equipment such as cameras.

Equipment breakdown coverage covers certain home appliances in the event of damages, electrical failure, or mechanical failure.

Once you’ve found the type of policy and coverages that are best for you, it’s time to start making decisions about the best overall insurance plan for your needs.

Happy mature spouses listening to real estate or insurance agent while discussing main points of document

Find the Balance: Good Coverage at Affordable Rates

Simply having homeowners, insurance is not enough. You need to ensure that your policy will cover all the items that are most important to you and that you are paying affordable insurance rates.

Your homeowner’s insurance premiums may vary depending on aspects such as your address and assets. Always do your research. Choose a company that provides reliable coverage at premiums that suit your pocket. Your policy limits and annual insurance cost increase when adding additional coverage or endorsement. But, by doing so, you expand the coverage on valuable assets. As you choose, particular policies, you should also consider whether they provide enough or, in some cases, too much coverage for your needs.

Being Underinsured

To be underinsured means that your homeowner’s insurance coverage is inadequate. You end up having to dig into your pocket in the event of damage or loss to your property. 


You should know the market value of your home and choose a coverage that is sufficient to cover replacement costs. But don’t pay for more insurance than you need.

An excellent way to get a good idea of what you should pay is by looking at average home insurance rates.  Compare rates in your state of residence to online quotes of multiple insurance companies.  

Don’t have the time (or patience) to search for quotes? Take a look at comparison sites such as Insure.com and NetQuote. 

How Can I Save Money on My Homeowner’s Insurance?

Risk plays a significant role in cost when applying for homeowner’s insurance. You can certainly save money by gambling with coverage amounts or by dropping specific endorsements, but there are better ways to lower your risk to save money on your premiums.

Qualify for Deals and Discounts  

Bundle multiple policies with one insurance provider. You may save up to 30 percent on premiums when using the same insurance provider for both your homeowners and auto coverage. Some insurers also offer claim-free discounts if you do not file for reimbursement for a specified time.

Make Home Improvements

Lower your risk of potential damage by fixing things around your home. Replace old plumbing, add detection sensors for water-leaks or gas-leaks, or clear dry brush around your property to prevent fires from reaching your home.

Install a Security System or Security Features

Lower your risk of events such as theft or fire by installing or updating your security features. These may include alarm systems, smoke detectors, and water sprinkler systems.

Higher Deductibles

Your deductible is a yearly amount you must pay toward home damages before your insurance kicks in. The higher the deductible, the lower your premium will be, Choose higher, but affordable deductibles for emergencies to get lower premiums.

Increased Rates and Premiums

Is your insurance company asking for rate hikes? As mentioned before, your risk greatly influences your premium rate. Living in areas that are often affected by natural disasters will increase your risk and, ultimately, also your insurance premiums. Natural hazards include events such as wildfires (as seen in California), tornadoes (as seen throughout the Midwest), and hurricanes. Your rates may also increase based on the number of the value of claims you have made.  

When Making a Claim: you should be aware of the possible rate increase risk for filing frequently (2-3 times in two years). The insurance company might even refuse to renew your policy due to the higher risk.

Filing a single claim doesn’t typically result in premium increases. If your claim is only a few hundred dollars above the deductible, you should avoid making a claim. If you make smaller (unnecessary) claims such as these, it will cause you to lose discounts you get for remaining claim-free.

What to Look for in Homeowner’s Insurance Companies

Here are a few essential things to look for when deciding on a homeowner’s insurance company.

Financial Stability

Homeowners insurance is, in most cases, a long-term commitment. It is crucial to know whether your insurance providers are financially stable and creditworthy. If the home insurers go bankrupt after you invest with them, you could lose out on your investment and claims.  

Financial stability ratings may be classified differently from one rating company to the next. They will, however, give you a good idea of the financial health of your insurance provider.  

Some examples of data that rating companies look at when establishing financial stability ratings include:

  • Balance sheet strength
  • Operating performance
  • Business profile
  • Enterprise risk management (ERM) 

You can compare ratings from organizations such as Standard and Poor’s, A.M. Best, Fitch Ratings, Kroll Bond Rating Agency, and Moody’s.

Later, when we compare some insurance companies, we will take a look at the A.M. Best rating. For more information on how the ratings work, you can refer to their guide on Understanding Best’s Credit Ratings.

Customer Service (Consumer Reports)

I am sure you will agree that, as the customer, you have certain expectations of service delivery. That applies especially when having to make a claim. You are, after all, investing your money with the company and losses can be a traumatic experience.  

Reading customer reviews is an excellent way to find out if insurance companies have a good reputation for customer service. As with checking financial stability ratings, you can also find customer service ratings online.  

J.D. Power is one of the companies that specializes in rating insurers on customer satisfaction. They look at aspects such as overall satisfaction, policy offerings, price, billing and payment, interaction, and claims.


The Better Business Bureau (BBB) is a company that specializes in analyzing companies’ trustworthiness. They look at the various aspects of practice and ethics before providing accreditation to any business, and they provide ratings based on the history of a business’s practices.

Handling Claims

When it comes to having to file for a claim, your insurance provider should be able to handle the request in a friendly, professional, and timely manner. Some insurance companies have a reputation for providing less coverage than agreed upon or dropping customers who have filed single claims. These companies are probably not the right choice.

Level of Coverage

Your level of coverage depends on the type of policy you choose. Will you have separate coverage for structure and contents, or will you cover both in one insurance package? Do you have additional items insured in your policy? Ultimately, the question is whether your insurance company can guarantee coverage tailored to your needs.

Sublimits on Personal Property Coverage

Your insurance policy has additional limitations towards coverage of certain losses. Sublimits set a maximum available amount to cover losses.  

Policy Cost

Besides the monthly installments, you should have a look at the insurer’s deductible policies. As mentioned in the “Saving money on your homeowner’s insurance” section, you will need to pay an amount when claiming. Your insurer might provide lower homeowners insurance rates, but have high-deductible policies.

Where to Shop: Companies That Offer Homeowner’s Insurance

By now, you should have a fair idea of what you are looking for in your home insurance. Some of the listed companies also offer Auto insurance. In this section, we will focus mostly on homeowner’s insurance.  

In the comparison below, we will look at the following:

  • Financial stability rating (by A.M. Best)
  • Customer service and consumer reports (by J.D. Power)
  • How the insurance company handles claims
  • Level and type of coverage: All listed companies provide the standard homeowner’s insurance that covers the home structure, contents of the home, liability, and loss of use. We will be looking at additional coverage
  • Policy rates
  • Discounts
  • In which states they operate
  • The type of customer who benefits most


Financial stability rating: Excellent or “A+”

Customer Service and Consumer Reports

When it comes to overall satisfaction, Allstate ranked in 10th place out of 29 companies, scoring “Average” with J.D. Power.

Claims Handling

Allstate serves as a point of contact. Rather than waiting for a call center agent, you will have an agent who you can deal with directly. They will assist you when purchasing a standard homeowner’s insurance policy, making a claim, or purchasing more insurance. When filing a claim for a policy that you bought through an Allstate agent, you should deal directly with your agent.  

Policies purchased through an independent broker must be claimed either over the phone or on the Allstate website.

Level and Type of Coverage

Allstate is the nation’s second-largest home insurer (holding about 9% of the market).

They also offer additional benefits when purchasing home insurance. These include: 

  • Premium Gauge
  • Claim RateGuard
  • Good Life 
  • Mobile apps

There is an optional coverage called the “Green Improvement Reimbursement.” This coverage will provide you with a higher payout to replace your lost items with more energy-efficient alternatives.

Policy Rates

When compared to other national insurance companies, Allstate falls under the more expensive bracket. Rates do, however, depend a great deal on your location and other risk factors.

If you purchase Claim RateGuard, your homeowner’s insurance rates will not increase after filing a claim.


There are discounts offered to all clients that could result in huge savings. Allstate is mostly known for its “First Time Homebuyer” and “Welcome” discounts. These discounts offer annual savings of up to 10% on your insurance cost.

In which states do they operate? All 50 states. On their website, you can even select your ZIP code to show you common home insurance claims for your area. This tool gives you a good idea of what kind of risks are common in your neighborhood. It is a helpful tool to gain more clarity on what type of coverage to select.

Customers Who Benefit Most

First-time homebuyers. Allstate is best when it comes to educating customers and providing resources. They also offer some critical discounts for first-time homeowners. 

Amica Mutual Insurance

Financial stability rating: Excellent or “A+”

Customer Service and Consumer Reports

Amica is the industry leader when it comes to ratings and reviews. In overall satisfaction, they ranked in 1st place out of 29 companies, holding the title for 16 years in a row.

One of the features that sets them apart is their “Contractor Connection” program. Amica will help you, at no additional cost, find contractors to take care of your home repairs or upgrades. These repairs or upgrades also come with a three-year warranty on their work.

Claims Handling

Amica Mutual is known for agents who quickly respond to and process claims smoothly while remaining professional.  

To file a claim, you need to call 1-800-242-6422. Alternatively, you can submit your request on the Amica app or their online claims portal.

Level and Type of Coverage

Besides the standard coverage, you also have the option of additional coverage. These include the replacement cost of your home, personal property, and other expensive items. Coverage for catastrophes like earthquakes and floods are also available.

With Amica Mutual’s Platinum Policy, you can increase coverage limits and policy options. These include liability and medical payments, replacement of locks, sewer and backup coverage, and additional replacement cost coverage on expensive personal items.

A feature you won’t often see with other insurance companies is their “Unauthorized use of a stolen credit card” coverage.  

Policy Rates

Amica offers the lowest rates in both auto and home insurance. They offer affordable prices for most customers – even without discounts.


Amica is owned by its policyholders and is, therefore, a mutual insurance company. Policyholders who purchase their dividend policy will receive dividends of up to 20% of your annual home insurance cost.

Amica offers loyalty discounts if you insure with them for longer than two years.

Other policy discounts include:  

  • “Multi-line,” where you bundle your home insurance policy with another insurance policy within the company.
  • “Claim-free” discounts for not claiming in three years.
  • “Autopay” discounts for setting up automatic payments.
  • “E-discount” where you can sign up to receive policy updates or bills over email.

Other offered discounts are:

  • Updating your home’s safety features.
  • When you are insuring a new or recently remodeled home.
  • When installing automatic detection devices.

In which states do they operate?

Amica mutual operates across all 50 states.

Customers Who Benefit Most

Are you looking for the best customer reviews and strong ratings? Then Amica Mutual is the best insurance provider for you.

Wife receives a house key from husband

State Farm

Financial stability rating: Superior or “A++”

Customer Service and Consumer Reports

When it comes to overall customer satisfaction, the State Farm insurance company rated 6th out of 29 companies. You can expect an above-average experience with regards to finding the right insurance and filing claims. They also have local insurance agents to deal with your queries or claim requests.

Claims Handling

State Farm is such a financially stable insurance provider, you don’t need to be concerned about their capability of paying claims. For your convenience, they offer a 24/7 online reporting service. 

You can also submit claims or access your account information through their free mobile app.

Level and Type of Coverage

In some regions, their “Premier Service Program” can help you get in touch with contractors to repair damages. These repairs come with an incredible five-year guarantee.

State Farm offers basic homeowners insurance, which covers loss or damage due to multiple causes. These include wind, fire, lightning, theft, vandalism and riots, frozen plumbing, windstorms, and hail damage.

They also offer additional coverage on flood insurance, valuable personal items, home businesses, and even identity theft.

Are you looking for auto insurance as well? You can find standard car insurance with State Farm.

Policy Rates

You will find that State Farm offers some of the most expensive rates. Keep in mind that the prices tend to vary depending on your region and property.


As a State Farm customer, you have access to a standard set of discounts or policy modifications. These include:

  • Rate discounts for remaining claim-free
  • Higher deductibles with a lower annual cost

They also include discounts when:

  • Taking out multiple insurance policies within the company
  • Installing sprinkler systems
  • Updating or installing security features 
  • Having impact-resistant roofing material 

If you are the owner of a farm, ranch, or manufactured home, you may qualify for additional discounts.

In which states do they operate?

State Farm offers national coverage.

Customers Who Benefit Most

When looking for the different (multiple) types of insurance, State Farm is the way to go.

USSA (United Services Automobile Association)

Financial stability rating: Superior or “A++”

Customer Service and Consumer Reports

U.S. military members and their families have a particular set of difficulties they face. What makes them unique is that USAA focusses on this type of client. They receive very few complaints and have a reputation for satisfactory claims resolution. 

Claims Handling

You can contact a representative or file your claim by using the free USAA mobile app.

They also have a section on their website to assist you with claims.

Level and Type of Coverage

Your belongings will be covered worldwide (even in a warzone). USAA will also cover your military uniforms.

Coverage of usual perils such as fire, vandalism, theft, and weather damage is also available. There are no deductibles when insured with USAA. Your home and belongings are insured with full replacement cost without depreciation.

Landlord coverage is an option if you are renting out your home. Renters receive protection against any liability claims and other usual perils. It also provides you with compensation for lost income if damage occurs to your property due to named perils.

Additional coverage options that renters insurance includes: 

  • Valuable Personal Property (VPP) insurance. Will cover the full value of precious items.
  • Umbrella insurance will provide additional protection from liability claims and lawsuits.

Policy Rates

USAA offers more affordable rates on auto insurance for younger drivers and homeowners with high-value properties. Generally speaking, you will find lower prices with USAA while receiving higher coverage.


Some features are free of charge for USAA policyholders, such as full replacement cost coverage for personal items with no depreciation deduction on claims.

Other available discounts include:

  • Up to 10% discount on your annual premiums if you remain claim-free for five years.
  • By bundling auto and home insurance, you can save up to 10% of your annual policy rate. 
  • You receive discounts on security systems for your home.
  • Discounts on storage costs.
  • Higher deductibles that lower annual policy rates.
  • Up to 35% discount for members on rental cars and the USAA car buying service.

In which states do they operate?

They offer insurance in all 50 states and also some international locations.

Customers Who Benefit Most

U.S military members, veterans, and entitled family members.

Farmers Insurance

Financial stability rating: Excellent or “A”

Customer Service and Consumer Reports

Farmers Insurance is known for its excellent customer service and its friendly agents. Their claims process is handled fast and with transparency. They have more than 48,000 agents working exclusively for them.

When it comes to overall customer satisfaction, Farmers insurance company rated 20th out of 29 companies. They do, however, receive very few complaints considering the size of the company.

Claims Handling

As with most insurance policies, your experience when filing claims depends a great deal on where you live. Farmers Insurance operates through subsidiaries in a few states. That means that they do not directly handle your claims.  

File claims by calling 1-800-435-7764 or through their online claims portal.

Level and Type of Coverage

Besides home insurance, you can also apply for auto insurance with Farmers. In addition to the standard insurance coverage, other policies include:

  • Identity Shield: If you fall victim to identity theft, your coverage is up to $28,500 in legal or other expenses. This also includes credit monitoring for up to two people, annual identity reports, and other advisory services.
  • Eco-rebuild: When you experience a loss due to named perils, this additional option will provide you with up to $25,000. You can use the money towards rebuilding, repairs, or replacement with more eco-friendly materials.
  • Contents replacement cost: This provides full replacement cost of personal items lost due to named perils. The coverage will take into account comparable features and reimburse you accordingly.
  • Trees and shrubs: This will provide pay-out in the event of a covered loss to trees, plants, shrubs, or your lawn. You will receive up to $750 per item lost. 

Policy Rates

They offer some of the best rates for high policy limits when it comes to homeowners insurance.


Besides their excellent home insurance rates, they offer discounts on upkeep, such as roof replacement. Other discounts include:

  • Bundle discounts of at least 16% on your homeowner’s insurance policy rate when pairing up auto and home insurance.
  • Non-smokers discount for living in a smoke-free home for two years or more.
  • Discount when insuring multiple cars.
  • Loyalty discount when staying with Farmers insurance for three consecutive years.
  • Discounted rates when paying your annual premium in one lump sum.
  • A transfer discount for switching to Farmers from your current insurance company. There will be no lapse in your coverage if you choose to change.
  • Discounts on renovations made to your home’s heating, electrical, and plumbing systems.
  • If your home’s roofing materials are approved impact-resistant by Underwriters Laboratories (UL).
  • If Energy Star, EPA, or LEED certify your home.
  • You receive partial reimbursements when installing fire alarms, security systems, or fire sprinklers.

In which states do they operate?

Farmers insurance operates in all 50 states.

Customers Who Benefit Most

Homeowners with properties less than 12 years old or homeowners with estates worth more than $200,000 are likely to save. If you are increasing your property value by making home improvements, you will benefit.

If you are a driver of ride-hailing services such as Lyft or Uber seeking coverage, Farmers may be right for you.

Your Next Steps

These are only a few of the home insurance companies that are currently operating in the U.S. As you can see, most of these insurers offer standard homeowners insurance.  

All the companies listed above are financially stable institutions. You don’t have to worry about them being capable of paying out on a claim or going bankrupt.

Customer satisfaction is of the utmost importance when choosing your insurance company. You want to insure with a company that is transparent, helpful, friendly, and quick in response. Remember to look at online reviews and testimonials from previous or existing clients. That will give you a good idea of how the company treats its clients and handles claims.

Additional discounts and benefits are always a plus point in any insurance company. Qualifying for discounts could add up to significant annual savings on your insurance premiums.

If you wish to investigate more, you might also want to look at companies such as The Hartford, Nationwide, Liberty Mutual, and Progressive when choosing your policy. Don’t forget to read the fine print, as there might be hidden clauses that can affect your coverage.

With the changing climate and unpredictable natural disasters, it’s vital to have your valuables and property protected. You may not know what the future holds, but you can guard your belongings, home, and even family and friends by making informed home insurance choices. 

Is your home insured? What is your preferred homeowner’s insurance provider? If not, there is no better time to start protecting the things you value!

Home Insurance Policy and Why It is Important

Home insurance policy is also known as homeowner’s insurance policy. A lot of people tend to consider it as an unnecessary expense. This is because they don’t seem to come to terms with the concept behind it. 

Say, for instance, you are going grocery shopping at about $50. When you get to the grocery aisle of the mall, two things can happen:

  1. You spend exactly $50 on all purchases.
  2. You spend less than $50 on the purchase.

It should not be possible to spend more than $50 when cash at hand is only $50.

Relating this to homeowner insurance policies, the more money you spend to obtain insurance on your home, the more the insurance covers. Conversely, the less money you spend, the fewer the insurance covers. It also happens that an insurance company would pay 20-25% more than your home insurance policy limit to cover all the damages to your home.

What is a homeowner’s insurance policy?

Homeowner’s insurance policy is a policy that protects your home from adverse conditions or unplanned eventualities. 

Homeowners insurance protects you from irreparable losses. It is the backup plan for theft, fire outbreaks, system failure, lightning, hail, explosions, or more. Instead of footing the bills for damage control, your insurance company takes care of it.

The truth is, no one ever builds a house dreaming of disasters to befall it. They build a house as a legacy; something that would hold possibly long after they are gone to ensure that their offspring or family members are well-taken care of. 

Getting a new house is expensive, especially when it is possible that all valuables could have perished alongside the house. In the aftermath of a disaster, it is your insurance policy that will bail you out. Hence, it is important to insure your property. Most importantly, there is no better time to ensure your property than now. 

What is the basic homeowner insurance coverage?

There are basically three levels of coverage:

  • Actual Cash Value: this is the value of your house in the current market and not what you purchased it for. In case of any repair, your insurance company will only pay what your house is worth according to real estate agents.
  • Extended Value: this is the 20-25% increase in your home insurance policy limit that your insurance company is willing to pay on any damage incurred on your property. 
  • Replacement Cost Value: this is the cost of repair on your property, equal to its original value.

HO1 to HO8 forms are property protection forms that cater to the needs of homeowners and types of residence in the US.

HO1 policy (basic form for homeowners)

This policy strictly covers the “perils” listed in your policy and it only allows 10 – vandalism, aircraft damage, lightning, vehicle damage, theft, riots, explosions, volcanic eruptions, fire or smoke, hail and wind storms. This policy does not give room for personal property or liability coverage.

HO2 policy (broad form for homeowners)

This policy is an expanded form of HO1. It covers all the perils stated in the HO1 form as well as 6 more of its own. Sudden home system dilapidation, falling objects, Accidental damage from electrical failings, AC or heat failures, adverse effects of winter on the house, etc. 

HO3 or “open peril” policy (special form for homeowners) 

This is the most common policy form. It caters even to perils not listed in your home insurance policy and also HO1 and HO2 forms. It covers both personal properties and liabilities. There are about twenty perils not covered in HO3 form. few are floods, war, environmental pollution effects, theft when the house is under construction, water damage, pest infestation, and more. 

HOB (hybrid owners policy) is the same as HOB3 polic,y but it covers water damage.

HOB4 policy (for tenants)

This policy covers the personal properties and liabilities for tenants including loss of use (when a living space in inhabitable, your insurance company will step up and cover the expenses for lodge accommodation and feeding) 

HOB5 policy (comprehensive form)

This is the most expensive home insurance policy, but it has the most coverage possible. It covers more perils than the other policies and like HO3, it is an “open peril” policy.

It engages the replacement cost coverage type.

HOB6 policy (for condos)

This policy will cover all your personal properties and liabilities if you live in a condo. Like the tenant’s policy, it does not cover the structure of the building. It also does not cover your personal items.

HO7 policy (for mobile homes)

This policy is the same as HO3 policy except, it is modified to suit mobile homes. The policy covers 6 types of mobile homes and some of them are modular homes, park model homes, double-wide manufacturers mobile homes, sectional homes etc.

HOB8 policy (for older homes)

This policy covers older homes. It is the same as HO3 but it has been tweaked for old homes, registered landmarks, and historic homes.

It covers homes that are more than 40 years old and homes that don’t meet structural cosmetic update requirements. This peril plan engages actual cash value coverage type.

A standard home insurance policy (HI) will cover:

  • Interior or exterior damages. These are damages inflicted on the interior or exterior part of your property. It can be due to arson or other fire-related damages, hurricanes, willful destruction or damage of your property by an external party without it being for a restorative purpose. In any of these cases, your insurance company will cover totally or partially the cost of renovation.
  • Liability coverage for accidents caused by you or members of your family including pets. This protects you from the grievances of others. For instance, if you have a dog that takes delight in peeing in your neighbor’s potted plants and she or he lodges a complaint, you can choose to pay for the damages through your insurance company. Or a different scenario where something of someone gets damaged on your property you can also choose to settle the debt through your insurance company. 
  • Living expenses during a period of renovation. If your house is undergoing renovation and you can’t live in the house because it’s the whole house that is to be reconstructed, possibly because of a fire, hurricane, or flooding incident. All expenses incurred from hotel rooms or rented living space, feeding, laundry, rented furniture, and storage of properties until the work on your house is done will be covered by your insurancecompany. Now, this is a sweet deal if I may say so myself.


This is an extra benefit or clause added to the basic terms of pre-existing policy contracts to cover damages incurred on your property. For damages resulting from natural disasters like earthquakes, floods, and careless home management, “acts of war”, and ” acts of God”,  riders can be employed.

A rider affords you the benefit of improving your policy without acquiring a different home insurance policy.

Ordinarily, insurance policies do not cover natural disasters except with the aid of a rider.

How much does homeowners insurance cost?

The amount of premium you pay depends on the property you are trying to protect.

  • An estimate is drawn after an agent survey the cost to rebuild your home, which includes the cost of the land and the content of your home. 
  • The material used to construct your home. Premium is higher for homes built out of wood than bricks.
  • The distance between your home and natural resources like water and the distance to services like the fire department. 
  • Home quality, age, and maintenance. The older a home is, the higher the premium will be.
  • Cooking appliances.
  • Recreational activity amenities such as pools, ball courts, playground, anything that can lead to injuries.
  • Pets: the more docile a pet, the less expensive it’s premium will be. However, if your pet is on the aggressive list of pets, your premium will be high.

Tips To Lower Your Insurance Cost

Boost your deductible. Deductibles are out-of-pocket expenses that you will need to cover in order to reduce your annual premium from the insurance company. The downside to this tip is that sometimes the cost incurred will be high.

Security systems and alarms: installing a burglar-proof system closely monitored by a central or local police station with proof of contract (for the benefit of your insurance company) will reduce your annual insurance by at least 5%.

Multiple policies discount: For insuring your automobiles as well as health with the same company, you can get at least a 10% discount from your insurance company. 

Mortgage: Ensure you pay off your mortgage (a type of loan secured to purchase fixed assets, for example, a house or land). If your mortgage can be a 100% settled, your annual premium will drop drastically. If you pay off your mortgage, your insurance company will think that since the house is yours you will take care of it responsibly.

Additional Construction. If you ever decide to build an additional structure on your land, take note of all the factors that can raise your premium. After that, build the structure accordingly. You already know that wood structures invoke high premiums and pools can raise your insurance premium as high as 10%.

You are already scrambling to get your property insured, aren’t you?

It might look a lot to absorb initially, but insure your home today!