We all enjoy buying things we want. Don’t believe me? Just click purchase on that dream item that has been hanging out in your cart on Amazon for the past 6 months and tell me you’re not continuously tracking that sucker until it’s in your hands. If you’re like me you’ll have app, email, and text tracking notifications going in order to watch its journey. People love to buy… but insurance doesn’t typically fall into that heart racing, can’t wait type of thing we love to buy. Maybe because we have to have it? Maybe because it’s intangible and can’t be used and appreciated until needed? Maybe a different reason completely. Regardless, a majority of people will purchase insurance in their lifetime so it’s important to know HOW to buy it.
Things to Have/Know Before Buying Homeowners Insurance
The homeowner needs to know a few things before beginning the shopping process. Do you want to insure the home at replacement cost or actual cash value? Are you comfortable with a high deductible or with a low deductible? Do you have other structures like fences, sheds, detached garages that need to be insured as well? Do you want to insure your roof at replacement cost or actual cash value? Don’t know what replacement cost or actual cash value is? Refer to my blog that explains all that here.
Typically, all companies will need some personal information as well. Name, birthdate, and social security number of you or spouse/partner living in the house is a starting point. Did you know that insurance premiums are mildly based off credit scores? They are! Companies will also typically need your address, square footage of the home, any updates to the electrical, plumbing, HVAC, roof, an estimation of what contents you have in the house, whether you have a pet and what breed, and how far the closest fire hydrant and fire station are to your home.
How to Buy
What kind of buyer are you? Do you like to shop around or do you like to work with a specific person you’re comfortable with? Both are fine, but that’s a good starting place. Find your agent. Typically there’s two directions you can explore when looking at options for your homeowners insurance, captive agents or independent agents.
What’s the difference? Captive means that they have access to one company, they are captive to that company. This is going to be State Farm, Farmers, AllState, Farm Bureau, Shelter etc. They can be great options to protect your home. Independent agents are a little bit different- instead of having one company they usually have multiple companies to explore and compare the best option for you.
Once you establish what works best for you, ask for a quote. Typically, you can do it via email, phone call, or online depending on the agency. They’ll need some of the information mentioned above. If you want multiple agents to look at it then repeat this process. Some can get you a quote in as little as an hour and some may take a few days if they’re exploring multiple companies. Once you get the quotes ask questions about the coverages that are important to you such as “will my roof change to Actual Cash Value coverage after 5,7, or 10 years?” or “If I am displaced from a covered loss, will this pay for those additional costs of living like a hotel or the increased travel cost?”
Everybody buys different so buy whichever way works best for you. If you have questions regarding your insurance, ECI is always here.