Selecting a Homeowner Insurance Policy

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Selecting a Homeowner Insurance Policy

First off, I'm not going to tell you where to get the best homeowner insurance quote, mostly because I don't know where to get it. I can't tell you the best website, the best company, or the best policy. Asking where to get the best insurance quote would be like asking which is the best red car to buy. Who knows? Are you going to put car seats in it? A bike rack? Do you need seating for five or only two? All these types of questions play into the insurance game as well. What I can tell you though, is what to look for and what to look out for.

One of the most important things to do when you're shopping for homeowner insurance is know what you need, and know what the insurance company is quoting you for. Back to the car analogy, would you pay an extra $1000 to double the fuel efficiency of your car? I would guess that in today's market you would. Especially if that meant getting 50+ mpg. Now, would you pay $1000 to add a hot water kettle to the same car? Probably not, for several reasons. Number one you'd never get your money out of it. Number two, you have absolutely no need to boil water in your car. It would be the pinnacle of ridiculousness to put a hot water kettle in your car, and there are plenty of "features" on a lot of homeowner insurance policies that are just as silly.

The only way you can determine what's ridiculous and not in the home insurance world is to know what you're getting and what you need. If you don't need it and you're getting it, you've got yourself a car that can make tea and coffee. If you need it and you're not getting it, you've got a car without wheels.

So let's put a framework around our evaluation and determine our needs from there. Our framework will be: structure coverage, personal liability, personal assets, and off-premise living. The coverage levels in these four aspects of a homeowner insurance policy will give you a very good idea of what you're getting from company to company, and also give you a quick test to see what levels of coverage you're getting in the major areas that you should be concerned about. We can further expand on these areas, but we won't do that here. Stay tuned for more articles covering each of these areas in detail.