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How to Buy Homeowners Insurance in 7 Easy Steps (2021)

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Jeanette Wisniewski

By: Jeanette Wisniewski

Edited by John Leach

Last Updated June 4, 2021

Why you can trust Insurify

Insurify partners with top insurance companies and is a licensed agent in all 50 states. However, the insurance experts writing our content operate independently of our partners. Check out reviews from over 3,000 satisfied customers, how we make money, our data methodology, and our editorial standards.

What's the easiest way to get home insurance?

The fastest way to find the best and cheapest home insurance is by comparing quotes from different companies. The fastest way to compare quotes is through insurify.com, the nation's most trusted insurance quotes comparison website. Best part? It's free.

You’ve scraped the money together, haggled with the seller, and survived the inspection—now you have to make a decision on homeowners insurance (which comes with its own list of decisions, by the way). When will the madness end?!

Buying a home can be a stressful experience. Knowledge is power, though—and knowing how to find and buy the best home insurance policy is easier than you may think.

No matter how confusing making policy decisions seem right now, Insurify can simplify the process by letting you compare quotes from top home insurance companies and buy great homeowners insurance at the best price.

Really! Compare quotes tailor-made for you in just minutes.

How to Buy Homeowners Insurance

Buying a home is an athletic endeavor. Although finding the right place (for the right price) takes work, the first few laps are mostly enjoyable. Getting from there to the finish line, however, can be grueling. In fact, many exhausted buyers leave important insurance decisions up to their mortgage companies—just to save themselves a few steps.

The downside of letting the lender do the work? Not only are you leaving money on the table today, but you’re also passing on a skillset you could use over and over again to safeguard your home, belongings, and your bank account well into the future.

Begin your homeowners insurance shopping journey by following these 7 easy steps and you’ll have your insurance policy, and the keys to your house, in no time.

Step One. Change Your Mindset

Insuring your home and belongings isn’t a “one and done” deal. Even if this is the only home you’ll ever buy, everyone’s life (and insurance needs) changes. And, the insurance business is quite competitive. There’s always someone out there who wants the chance to serve you better than your current provider. Learn how to shop now so you can take advantage of these opportunities and take care of what is yours.

Step Two. Keep Control in the House-Hunting Process

Many things related to the location and construction of your house can factor in insurance costs. Knowing this ahead of time can keep financial surprises (and stress) to a minimum. These factors include:

  • Quality and location to the fire department

  • Proximity to the coastline

  • Age of the home

  • Condition of the roof

  • Quality of construction

  • Risk of flooding

  • History of earthquakes

  • Swimming pool or other special feature

Step Three. Learn Some New Vocabulary

A lot of words get thrown around over the phone and across the desk. Having a basic understanding of vocabulary ahead of these conversations can keep you from becoming frustrated or having a misunderstanding. The Insurify home insurance blog is a good place to start your word-learning journey. Many individual insurance company websites include educational links as well. Take advantage of these!

When you’re shopping for quotes online or in-person, ask questions and keep your glossary of terms in mind.

Step Four. Familiarize Yourself with Policy Types

There are several different “types” of insurance coverage that you can buy. These different types cover your home (and in some cases, the contents of your home) in the event of different disasters or perils.

These policy types include:

  • Basic HO-1

  • Broad HO-2

  • Special HO-3

  • Renters HO-4

  • Condo/Co-op HO-6

  • Modified Coverage HO-8

What kind of policy will your future home require?

When discussing policy types, you’ll need to think in terms of what perils the policy covers. Perils range from fire, windstorms, smoke, and vandalism to and explosions, riots, and even volcanic eruptions.

Step Five. Understand Your Options

Homeowners insurance is a collection of several different coverages that are meant to protect you financially when unfortunate things happen. These coverages include:

  • Dwelling Coverage. Pays for damage to your house and to the structure of your home. This includes damage to fixtures, such as plumbing, electrical wiring, heating, and permanently installed air-conditioning systems.

  • Other Structures. Pays for damage to fences, tool sheds, freestanding garages, guest cottages, and other structures not attached to your house.

  • Personal Property. Reimburses you for the value of your personal belongings, including furniture, electronics, appliances, and clothing that is damaged or lost even when they aren’t on your property, such as those at an off-site storage locker or with your child at college.

  • Loss of Use. Pays some of your additional living expenses while your home is being repaired.

  • Personal Liability. Covers your financial loss if you are sued and found legally responsible for injuries or damages to someone else.

  • Medical Payments. Pays medical bills for people hurt on your property or hurt by your pets.

Replacement cost coverage after natural disasters may require supplemental insurance product add-ons to your policy. Carefully read your policy to fully understand the ins and outs of your coverage. Keep an accurate home inventory checklist with accurate replacement value to ensure the largest payout from an insurance claim.

Step Six. Head to Insurify

Now that you’re armed with the basics, it’s time to find the best insurance policy for you and your real estate. Not only are you aiming to purchase enough insurance to satisfy your mortgage company, but you also want to make sure that you have the most comprehensive policy you can afford at the best price. One that:

  • Covers your structure and belongings

  • Protects you additionally should you be displaced

  • Provides you with liability coverage should someone be injured at your home or on your premises

  • Protects you against perils that are common for homeowners (water damage, for example) and to your home’s geographic location (for example, if you live in a flood plain, flood insurance is recommended)

  • Is with a provider that can offer you the best combination of discounts, payment options, and services at your price point.

Now to the most important part of the insurance shopping process…leave the agents and manual searches in the 2010s where they belong!

Use Insurify to start comparing apples-to-apples quotes that are tailor-made to fit your preferences and needs. A few minutes are all that’s standing between you and a cheap home insurance policy that covers your dwelling and your family. That’s right— Insurify is your one-stop destination to compare, review, and buy your home insurance, 100 percent online.

Step Seven. Review and Update Coverage Consistently

Buying a homeowners policy isn’t like putting on a 20-year roof. You don’t just buy it once and wait.

Reviewing your policy often to keep coverage in sync with your lifestyle and your home protects you financially and can even help you find even more ways to save. According to the Insurance Information Institute, you should re-evaluate your coverage when any of these things are happening:

  • When your policy comes up for renewal

  • When you’ve made major purchases or improvements to your home or property (like adding a room or installing a hot tub)

  • When you’ve added safety features (things like adding a burglar alarm can sometimes qualify you for more discounts)

  • When your lifestyle changes dramatically (marriage, divorce, and starting a home business are some examples)

Even outside of these events, you can always be scouting discounts offered by insurance carriers as a means to reduce your monthly insurance premium. A common way to cut costs is to bundle home and auto insurance with the same company. (You can save big on car insurance too, y’know.)

Things to Keep in Mind When Insurance Shopping

Though Insurify ‘s brief questionnaire is all that’s required of you to get the AI-powered policy matches you’re looking for, you might want to brush up on some concepts first. Here are some additional concepts to consider while you are shopping:

Think in Terms of Deductibles

Your monthly insurance homeowners insurance coverage premium (how much you pay) is directly affected by the deductible you choose. Your deductible is the amount you will have to pay before an insurance claim is paid out.

Choosing a higher deductible makes for easier monthly payments, but could put you in a financial pinch should disaster strike. For this reason, it’s important to map out different deductible scenarios now to be sure that you are comfortable with both your monthly premium and what the future may have in store.

You may be able to reduce your homeowners insurance policy premium by applying certain insurance discounts like using the same insurance company for your home and auto (aka bundling your policies).

Consider Actual Cash Value (ACV) vs. Replacement Cost (RC)

These are the two different methods insurers use to establish the value of your home and belongings when it comes to reimbursing homeowners’ claims.

Replacement Cost is the amount of money it costs to replace an item if you were to go out and buy it new.

Actual Cash Value is the current value of the item including depreciation (the loss of value of insured items over time).

Replacement cost insurance is the more expensive of the two options and is reflected in your monthly insurance bill—but it also gives you the most property coverage and is the more common of the two choices for homeowners. Mortgage lenders generally require that your standard policy covers the replacement cost of the home (often the loan amount itself). Additional coverage can be added to your policy to ensure the market value of your personal property is covered.

Get a Feel for the Claims Process

When it’s time to make a claim on your home (or your stuff) you’ll feel a whole lot better if you know what you are getting into ahead of time. Besides being sure of your predetermined amount of coverage, additional questions to ask about the claims process include:

  • What kind of property damage is a covered loss?

  • How long do I have to file a claim?

  • What deductible will I have to pay?

  • What are my coverage limits?

  • How long will it take to process my claim?

  • Will I need to get estimates before I submit a claim?

  • How will I get paid?

  • Who gets the check?

  • Do I need to replace items immediately?

Payment is often one of the most confusing (and frustrating) parts of the process and although you may not be able to ask every question upfront, having a basic understanding of how the payment process works before something happens can save you some time and your sanity.

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How to Buy Home Insurance: Frequently Asked Questions

  • Lenders require that you have homeowners insurance in place before you can close on your house. Lenders can suggest some basic policies or you can shop homeowners insurance companies locally and online for a more tailored solution.

  • Mortgage lenders generally require that your policy covers the Replacement Cost Value (RCV) of the home (often the loan amount itself). Additionally, you’ll want to consider having enough additional coverage to replace your things, to cover any potential liability for future injury or damages, and even to reimburse living expenses.

  • If you have a lot of time on your hands, you can review policy options and pricing one company at a time. If you want to go old school you can choose an independent insurance agent who’ll do the shopping for you. More and more insurance shoppers, however, are using online comparison websites like Insurify. Comparison sites are driven by AI and allow users to quickly compare real, ready-to-buy policies from several companies at once. Homeowners can count on sites like Insurify to sort through providers and policy options so they can spend less time comparison shopping and more time focusing on the home buying process.

The Best Way to Start Your Home Insurance Journey

Life is a journey that’s full of changes. Learning how to keep your home insurance policy in sync with these changes is as a practical skill as turning off the coffee pot or locking your door—and it can be just as easy as well!

Compare home insurance quotes now with Insurify and see how stress-free it is to make good decisions quickly about your homeowners policy—all on your own. Whether you’re a first-time home buyer or an experienced real estate guru added a new home to your list, home insurance coverage is vital to your financial safety structure.

(And check in every six months or at least after every major life or home change to see how much you could save from leading insurance providers!)

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  • Data scientists at Insurify analyzed over 40 million auto insurance rates across the United States to compile the car insurance quotes, statistics, and data visualizations displayed on this page. The car insurance data includes coverage analysis and details on drivers' vehicles, driving records, and demographic information. With these insights, Insurify is able to offer drivers insight into how their car insurance premiums are priced by companies.

Jeanette Wisniewski
Jeanette Wisniewski

Insurance Writer

Jeannette Wisniewski is a technology writer whose passion is encouraging people to engage with technology by making it more understandable and more interesting. Though she enjoys writing business copy for a wide range of subjects, she is most inspired by emerging tech and its applications. She is a graduate of San Jose State University, a Georgia Peach at heart, and happy to call Boise, ID home.

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