Whether you are shopping for homeowners insurance in NH because you are buying a new home or looking for better pricing or coverage, there are several essential points to consider. Below are five tips that can help save you money from the experienced agents of HPM Insurance.
5 Tips When Shopping for Homeowner's Insurance
1. Go to an Independent Insurance Agent
Why? Independent insurance agents are just that, independent. They do not work for an insurance company (such as Geico) or only sell for one insurance company (such as State Farm.)
Instead, independent agents represent multiple insurance companies providing more coverage and pricing options than agents representing one company.
It is beneficial because insurance companies don't keep their rates the same over time. Insurance premiums can fluctuate for reasons that have nothing to do with one's own policy, such as:
- an increase in claims within a geographical area results in increased premiums for all within that area.
- a desire for a company to expand into new territory often means lower pricing to attract more clients.
- a desire for a company to slow down or stop growth within a region due to more or more significant claims than expected may lead to price increases for all insureds.
As these examples show, the premium increase has nothing to do with the individual insured but rather the company's business plan. When you are insured with a company that only offers its own policy, you may not know what is happening. If you do notice and contact the company, there is not much they can do as that is all they may offer.
With an independent agency, they offer at least a few, if not many more. This means that you have an insurance professional looking at your policy regularly with the context of what is happening with other companies they represent.
This is not to imply that your independent agent will "shop" your coverage every year, but they will at least have the knowledge of what is happening in the industry and know if your premium is competitive or not, and take action accordingly.
If you are unsure your agent is independent, you should be able to find out by going to the agent's website and checking for the companies they represent.
2. Bundle your NH Homeowner's Insurance with your Car Insurance
If you have your homeowner and auto insurance with two different carriers - get a quote for both policies with the same agent and company. You will likely save money on at least one or the other, but most likely both!
Another benefit of having both policies with one agent is that the agent can look at your account as a whole. For example, It is not uncommon for us to ask for the auto insurance of an existing home insurance client only to see their liability limits well below what we would recommend.
Direct insurance companies love selling on price because, on the surface, it looks like you are saving money. But are you saving money if you don’t have collision coverage to fix your car if in an accident or have enough liability coverage to protect your assets?
3. Choose your Deductible Wisely
Many people let the agent or company choose their homeowner's deductible for them, but it is something you should consider.
Why? The higher the deductible, the lower the premium. The lower the deductible, the higher the premium. You are balancing the savings received in premium for a higher deductible while considering the ability to pay the deductible should you need to file a claim.
Deductibles often vary between $500 and $5000, with many companies now requiring at least $1,000.
If you choose a low deductible, you will have less out-of-pocket expenses in case of a claim. However, insurance companies look at claims and claim frequency very closely. Therefore, if you regularly file small claims because you can, you will see either a premium increase or the non-renewal of your home insurance.
The best advice is to get a quote with a few deductible options. The information will guide you to determine if the increase in deductible is worth the savings.
4. Review Coverage Enhancements
Nearly every home insurance company has a coverage enhancement, which does what it implies- it enhances coverage. The challenging part is that each insurance company creates and prices its coverage enhancement, so whether you should or shouldn't purchase it depends.
Coverage Enhancements are a package of multiple coverages intended to add or broaden existing coverage.
When looking at such coverage, consider your home and review the coverage provided by the enhancement. For example, do you have central ac or a heat pump? If so, equipment breakdown could come in handy if part of the carrier's enhancement. Likewise, do you have a sump pump- perhaps you need water backup coverage, which may be included in the enhancement?
Pricing for enhancements can vary from $20 to $200+, so find out what is covered and if you could ever use it. To complicate matters, you may find that the pricing increases when you remove the enhancement, so be aware and have an open discussion with your agent regarding the costs and benefits of it.
5. Ask Questions!
Homeowner's insurance is often a policy to address the most common needs of most homeowner's. However, as everyone is different, you may need more or less of a particular coverage.
An example of this may be working from home. Who insures your laptop and other business property if you work from home? What about deliveries to your home for business purposes. Are you covered?
Are you planning on putting an addition onto your home? If so, are the materials covered while being built, and do you have enough dwelling coverage?
You inherited your mother's wedding ring- is it covered?
Insurance agents do their best to cover clients adequately, but we don't have crystal balls. So if you have or do something out of the ordinary, bring it up with your agent. That is why you have them.