HOMEOWNERS INSURANCE: Companies, Quotes, and Buying Guide

Homeowners Insurance

Because your home is one of your greatest and most important investments, it makes sense to get the best homeowners insurance available.
Homeowners insurance (also known as home insurance) is a requirement, not a luxury. Not just because it protects your home and belongings from harm or theft. Almost all mortgage companies require borrowers to have insurance coverage for the full or fair worth of a property (typically the purchase price) and will not grant a loan or finance a residential real estate transaction without proof of it.
You don’t even have to own a home to need insurance; many landlords require renters to obtain renter’s insurance. However, whether it is mandated or not, it is prudent to have this level of security. We’ll go through the fundamentals of homeowners insurance policy, cost and companies.

What Is Homeowners Insurance?

Homeowners insurance is a form of insurance policy that provides financial protection in the event that your home or valuables are damaged or destroyed. A policy will specify what structures and goods are protected, to what extent, under what conditions, and how much you must pay before the insurance policy begins to pay you (this is called a deductible).

For example, a policy may indicate that your home is insured for fire damage up to $300,000 with a $1,000 deductible. This means that after you pay the $1,000 deductible, your home will be destroyed in a fire. The insurance company can reimburse you up to $300,000 to repair or rebuild your home.

Most ordinary policies will also cover your personal belongings up to a predetermined maximum, provide some liability coverage in the event that someone is hurt on your property, and provide loss-of-use coverage. Loss-of-use coverage compensates you if you are unable to stay in your home due to a covered occurrence and must stay in a hotel. Loss-of-use coverage reimburses you if you are unable to stay at home and must stay in a hotel as a result of a covered incident.

Our Best Homeowners Insurance Rating

#1. Lemonade

#2. USAA

#3. Amica

#4. Allstate

#4. State Farm

#6. Nationwide

#6. American Family

#8. Erie Insurance

#9. Liberty Mutual Insurance Company

#10. Chubb

#10. Advancement

#10. Farmers Insurance

In-Depth Review of the Best Home Insurance Companies

#1. Lemonade

  • 2022 Best Homeowners Insurance
  • OVERALL RATING: 360
  • 4.7 of 5 stars
  • AM’S best RATING
  • Online Tools
  • Estimate Online
  • Discount on multiple policy is available.

Lemonade stands out in our evaluation since it is nearly totally online. You can use their mobile app or website to join up for insurance, file claims, make changes to your policy, or even cancel it. This can be a significant benefit for those who would like to file a claim online rather to interact with an agent. And if you have a home-related issue that prevents you from using the internet, there is still a phone number you may contact.

Lemonade offers no-deductible additional coverage for high-value personal belongings such as jewelry, photography equipment, and musical instruments. It also takes pride in donating to charities through its Giveback program.

Lemonade, on the other hand, isn’t as readily available as the other homeowners insurance companies in our ranking.

#2. USAA

  • Caters Military Families.
  • OVERALL RATING: 360
  • 4.3 of 5 stars
  • AM’S best RATING
  • A++
  • Online Tools
  • Estimate Online
  • A DISCOUNT ON MULTIPLE POLICY IS AVAILABLE.

USAA: USAA stands out in our assessment since it provides its services and policies primarily to military personnel, veterans, and their immediate family members. USAA is also one of the few companies in our list that provides coverage if you are a victim of identity theft. Identity theft protection is included in the normal USAA policy, although most other homeowners insurance companies in our list charge an additional fee for it.

Unlike many of its competitors, USAA provides homeowners insurance in all 50 states. In addition, if you want to invest in a home security system, USAA has collaborated with ADT to provide savings to homeowners who have homeowner insurance policies with the company.

#3. Amica

  • Provides Dividend Paying Policies
  • OVERALL RATING: 360
  • 4.2 of 5 stars
  • AM’S best RATING
  • A+
  • Online Tools
  • Estimate Online
  • DISCOUNT ON MULTIPLE POLICY IS AVAILABLE.

Amica: Amica offers rates competitive with other companies in our rating, earning us the title of the best Cheap Homeowners Insurance Companies of 2022, and offers a variety of additional homeowners insurance coverage options, such as add-ons for your laptop, home business, and identity theft.

This is the only home insurance provider in our review that offers a dividend policy, which means you earn a part of your annual payments back. Amica also provides an all-in-one policy called Amica Platinum Choice, which combines a number of add-ons, such as extended coverage for precious objects and water backup/sump pump overflow choices, into a single homeowners insurance policy.

#4. Allstate

  • Coverage Options Are Extensive
  • OVERALL RATING: 360
  • 3.8 of 5 stars
  • AM’S best RATING
  • A+
  • Online Tools
  • Estimate Online
  • DISCOUNT ON MULTIPLE POLICY IS AVAILABLE.

Allstate: To supplement its normal homeowners insurance policy, Allstate offers a wide range of coverage choices. These options include more popular ones like scheduled personal property coverage for high-value assessed items, as well as less usual coverage for sports equipment, musical instruments, and your yard and garden. When you become a customer, Allstate will also link you with a local agent to better tailor your coverage to your needs.

While Allstate is one of the more costly homeowners insurance companies in our review, it does offer a variety of discounts that may lower the cost.

#4. State Farm Insurance

  • Inflation-adjusted Coverage
  • OVERALL RATING: 360
  • 3.8 of 5 stars
  • AM’S best RATING
  • A++
  • Online Tools
  • Estimate Online
  • DISCOUNT ON MULTIPLE POLICY IS AVAILABLE.

State Farm: One of the few companies in our rating that offers homeowners insurance policies in all 50 states is State Farm. Its normal policy is competitive with the policies of the other companies in our evaluation. It also provides a number of unusual discounts, such as a discount for installing an impact-resistant roof. Coverage for identity theft and sewer backups are among the various policy options.

State Farm has a large network of 20,000 insurance agents in the United States. If you prefer to buy insurance from a local agent, you should be able to find one near you.

#6. Nationwide

  • OVERALL RATING: 360
  • 3 out of 5 stars
  • AM’S best RATING
  • A+
  • Online Tools
  • Estimate Online
  • A DISCOUNT ON MULTIPLE policy IS AVAILABLE.

Nationwide: Nationwide’s standard policy, which is available in all but three states, includes coverage for credit or debit card fraud as well as rebuilding your house to current code in the case of an insured disaster. It also offers the Brand New Belongings benefit, which reimburses you for both the depreciated worth of insured belongings and the additional cost of purchasing new ones.

Replacement Cost, which pays the full replacement cost of an insured item rather than its depreciated value, and identity theft coverage are two extras that can be added to your homeowners insurance policy.

Nationwide is also the only insurance company that has been rated as having the Best Life Insurance, Best Renters Insurance, and Best Pet Insurance.

#6. American Family

  • OVERALL RATING: 360
  • 3 out of 5 stars
  • AM’S best RATING
  • A
  • Online Tools
  • Only as an agent
  • A DISCOUNT ON MULTIPLE POLICY IS AVAILABLE.

American Family: American Family places a high value on its local agents. In addition to its normal policy, American Family offers optional coverages such as matching sides, which implies that if part of your home’s siding is damaged, American Family will cover the restoration of the undamaged siding so that it all matches. Equipment breakdown coverage is also offered, which will cover some of your appliances, computers, smart components, and systems if they are destroyed due to mechanical failure or an electrical or pressure system event.

American Family homeowners insurance policies are offered in fewer than half of the states in the United States.

#8. Erie Insurance Company

  • 2022’s Cheap Homeowners Insurance
  • OVERALL RATING: 360
  • 3.6 of 5 stars
  • AM’S best RATING
  • A+
  • TOOLS ON THE INTERNET
  • Only as an agent
  • A DISCOUNT ON MULTIPLE policy IS AVAILABLE.

Erie Insurance: Erie Insurance is one of the few homeowners insurance providers that includes guaranteed replacement cost in its regular policy, whilst many others may only provide it as an option or not at all. Other possibilities include coverage for a water backup or sump pump overflow, as well as coverage for underground utility lines from your house to the curb. Erie is also ranked first in our list of the 2022 best Cheap Homeowners Insurance Companies.

One of the most significant disadvantages of Erie Insurance is that it is not as readily available as many of the companies in our category. Erie homeowners insurance policies are accessible in only about half of the states in the United States.

#9. Liberty Mutual Insurance Company

  • OVERALL RATING: 360
  • 3 out of 5 stars
  • AM’S best RATING
  • A
  • TOOLS ON THE INTERNET
  • Estimate Online
  • A DISCOUNT ON MULTIPLE POLICY IS AVAILABLE.

Liberty Mutual: Liberty Mutual, one of the least expensive homeowners insurance companies in our rating, offers homeowners insurance policies in all states except Wyoming. Liberty Mutual has a standard policy that is competitive with other companies in our rating and a large range of policy add-ons. These include replacement cost reimbursement, which reimburses the actual cost of replacing a covered item rather than its depreciated worth, and the ability to alter your coverage limits to keep up with inflation.

#10. Chubb

  • OVERALL RATING: 360
  • 3 out of 5
  • AM’S best RATING
  • A++
  • Online Tools
  • Only as an agent
  • A DISCOUNT ON MULTIPLE POLICY IS AVAILABLE.

Chubb: Masterpiece Homeowners Insurance is Chubb’s standard policy, and it provides coverage like as replacement cost and water backup. Chubb, in collaboration with Wildfire Defense Systems (WDS), even provides a no-cost option in which WDS will perform a wildfire hazard assessment and maybe assist you in preparing for evacuation, arranging temporary living accommodations, or cleaning up your property after a wildfire.

Chubb’s homeowners insurance policies are exclusively available through its own agents.

#10. Progressive

  • OVERALL RATING: 360
  • 3 out of 5
  • AM’S best RATING
  • A+
  • TOOLS ON THE INTERNET
  • Estimate Online
  • DISCOUNT ON MULTIPLE POLICY IS AVAILABLE.

Progressive: In contrast to the other companies in our assessment, Progressive operates more like an insurance broker, selling policies that are subsequently administered by other insurance companies. This implies that when it comes to submitting a claim, you won’t always be dealing with Progressive, even if Progressive is the first point of contact. This enables Progressive to provide you with a wide selection of coverage options and quotes to assist you in finding the policy that is best suited to your needs.

This business strategy enables Progressive to present you with a wide selection of coverage options and quotes to assist you in finding the best policy for your needs. Progressive is accessible in every state except Florida and Iowa.

#10. Farmers Insurance

  • OVERALL RATING: 360
  • 3 out of 5
  • AM’S best RATING
  • A
  • Online Tools
  • Estimate Online

Farmers Insurance: Farmers Insurance offers three separate categories of homeowners insurance, with each higher tier increasing both the coverage limits and providing more amenities. Claim forgiveness (where if you haven’t filed claims for a certain period of time, your premiums won’t increase after filing a new claim), deductibles that decrease the longer your Farmers policy is active, and a discount if you’ve gone a certain period of time without filing a claim are all features offered by all three policy tiers. The top-tier Premier policy provides Guaranteed Replacement Cost, albeit there are some restrictions.

Homeowners Insurance Companies with Cheap Rates in 2022

The pricing for our cheap Homeowners Insurance Companies are based on a sample policy. The policy covered a 2,400-square-foot townhouse in Illinois for $450,000 with a $1,000 deductible. We chose the least priced companies in our ranking for this list based on their pricing.


COMPANY
SAMPLE MONTHLY COSTA.M BEST RATING
Erie Insurance »3.6 out of 5$98.00A+
Liberty Mutual »3.5 out of 5$112.75A

How to Choose the Best Homeowners Insurance Policy for You

While house insurance may appear confusing and daunting, choosing the best home insurance provider and the correct insurance policy for you is actually rather simple. You must first evaluate the worth of your home and its contents, and then choose a provider and policy that offers the coverage options you require at an affordable price.
To purchase homeowners insurance, complete these steps:

#1. Determine what you wish to protect.

A typical homeowners insurance policy might not cover precious jewelry, artwork, or other valuables. Similarly, if you have a trampoline, pool, or anything else on your property that increases your liability risk by increasing the danger of injury or death to others, you may require additional coverage. If your neighborhood is prone to flooding, you’ll probably need a separate flood insurance policy from your home insurance carrier or the National Flood Insurance Program.

Similarly, if you live in an earthquake-prone area, you will require supplementary insurance to cover damage caused by earthquakes. Use the US Geological Survey’s fault map to determine how near you reside to a fault line and gain a better understanding of your earthquake risk.

#2. Determine the amount of homeowners insurance you need.

Make a list of all your personal belongings. If you have receipts, keep them in a safe place. Use this information to determine the amount of coverage you require for your property.

Get an estimate from your homeowners insurance company or a realtor for the average rebuilding cost in your area per square foot for your home and other structures on your property.

Determine how much money you would spend on a hotel, meals out, and other living expenses if your home was destroyed or became uninhabitable as a result of a loss. The Insurance Information Institute, as well as a certified insurance agent or realtor, can assist you with the procedure.

#3. Select an insurance provider.

To locate the best homeowners insurance company, look for one that offers policies with the coverage and additional features you require at a reasonable price. Additionally, look for a company that has a high financial strength rating from AM Best or another rating agency, has positive consumer and expert evaluations, and allows you to file a claim or seek assistance 24 hours a day, seven days a week.

#4. Select a policy.

The right house insurance policy will provide adequate coverage, have simple terms, and may even give discounts. Rather than a cash value policy that only pays the depreciated value, consider obtaining a replacement cost policy that will repay you for the expense of replacing your property with new things.

Combining Homeowners and Auto Insurance

Many insurance companies may give you a discount if you purchase more than one form of insurance policy from them, such as home insurance and auto insurance. Insurance bundling or a multi-policy discount is what this is called. Most insurance companies will give you a discount if you combine two or more policies rather than paying for each policy separately. This is worthwhile for the insurance company since it increases income per customer and fosters customer loyalty.

Insurance bundling, on the other hand, does not necessarily save money. According to Amy Bach of the consumer advocacy group United Policyholders, in some situations, an insurance firm that just sells auto insurance may give lower prices than companies that sell a variety of policies. According to Bach, a company that exclusively provides auto insurance may also provide perks that are not accessible in another insurer’s insurance bundle, such as ticket forgiveness or claims-free discounts.

How to Buy Homeowners Insurance

The first step in purchasing homeowners insurance is determining how much insurance coverage you require. Take a home inventory to determine the amount of coverage you require. A home inventory is a list of all of your personal belongings, both inside and outside of your home. Determine the cost of rebuilding your home following a tragedy (ask a real estate agent for building costs in your area). Determine whether you require extra coverage for earthquakes, floods, or a high-risk item such as a swimming pool.

If you’re having difficulties figuring how much house insurance you need, the Insurance Information Institute, as well as a professional insurance agent or realtor, can assist you.

Next, specify whether you want replacement cost coverage or actual cash value coverage. A replacement cost policy will pay to replace your personal property with new equivalent things, however an actual cash value policy takes depreciation into account — in other words, what your personal belongings are worth when they are utilized. For items that deteriorate quickly, like as electronics, an actual cash value policy may leave you significantly short when it comes to purchasing new items.

Furthermore, a replacement cost policy will give adequate insurance funds to restore your home even if construction expenses rise. As a result, even if premiums are slightly higher, most insurance experts recommend a replacement cost policy.

Then, focus your search to a few house insurance companies. Once you’ve narrowed it down to a few homeowners insurance companies, use the cost estimate feature on their websites to get an idea of how much the homeowners insurance coverage you want will cost. Request quotes from different companies, but make sure to compare policies that provide comparable coverages.

Read Also: AVERAGE HOME INSURANCE COST: Best 2022 UK Practices and Rates (Updated)

When you’re ready to acquire homeowners insurance, you can do it on the insurer’s website, over the phone, or through an independent or dedicated local insurance agent, depending on the business.

Some house insurance companies may conduct a home inspection to validate the condition of your home and assure enough coverage. If a house inspection is required, the insurance company will dispatch an inspector to your residence.

As a result of COVID-19, many insurance companies have altered their inspection procedure to include safety considerations such as PPE and social distance. Some inspections will not require your presence, and the inspector will concentrate on the exterior of your home, including the roof, as well as any potential dangers in your yard that could cause damage to your property in the event of a major storm.

Some companies, however, continue to perform interior inspections that focus on the condition of your home’s electrical systems, ventilation, fireplace, plumbing, heating, and air conditioning systems. Check the requirements of the insurer you are considering when obtaining house insurance to evaluate their home inspection processes.

How to Make a Claim on Your Homeowners Insurance

To make a homeowners insurance claim, follow these steps:

  1. If necessary, file a police report. If there has been a crime, you must submit a police complaint as soon as possible and keep track of who you speak with.
  2. Notify your insurance provider. Your insurance should also be alerted as soon as possible, either online or by phone, depending on business policy. This will help to expedite your claim and guarantee that you are rewarded as soon as possible.
  3. Perform any necessary repairs. Make any necessary repairs to your home, presuming you can do so securely. Before you begin, take photos of the damage and collect receipts for any goods you purchase.
  4. Support your assertion with documentation. All damage, stolen property, and anything else that would form the basis of the claim should be documented. Take numerous photos or a video of the damage, going room by room if necessary. Collect and share all security camera footage with your insurance provider if you have them.

Is Homeowners Insurance Necessary?

Even if their mortgage lender does not demand it, most homeowners should get home insurance. Many mortgage lenders will require you to have homeowners insurance in order to protect themselves financially, but house insurance is also one of the best methods to protect your largest investment: your home.

Even if you can afford to rebuild or replace all of your goods if your home is destroyed or robbed, homeowners insurance is a low-cost option to avoid having to pay a large out-of-pocket charge.

What Does Homeowners Insurance Cover?

Homeowners insurance protects your assets in the event of an unanticipated incident. A homeowners policy will pay to restore or replace your home or outbuildings, such as a garage, if something bad or even disastrous happens to them, such as theft, vandalism, storm damage, water damage, or fire. Your policy will also cover personal belongings held in your house or on your property, like as clothing and furniture.
Insurance will also cover liabilities if a visitor is injured on your premises. If they sue you, your coverage will pay their medical expenses as well as your legal fees. Finally, home insurance can cover objects such as a swimming pool, which increases a homeowner’s liability risk, as well as high-value items such as fine jewelry, however these frequently need a higher price to insure.

When acquiring an insurance policy, you should speak with an insurance specialist from the firm to ensure that you get the best policy for the best price.

How Much Does a Homeowners Insurance Policy Cost?

Monthly premiums varied from little under $100 for a policy with Erie Insurance to over $170 for a policy with Allstate for the companies in our rating from which we were able to acquire quotes for our sample policy. There are several factors to consider while obtaining homeowners insurance quotes, including the location of your property, square footage, and the level of coverage provided.

Homeowners Insurance FAQ’s

Is Flood Damage Covered By Homeowners Insurance?

Flooding is generally not covered by ordinary homeowner’s insurance policies. You can look up your home’s location on the FEMA Flood Map Service Center’s website to see if it’s at risk of flooding.

Is fire damage covered by homeowners insurance?

Most homeowner’s insurance policies will cover your home in the event of a fire. This coverage often extends to damage caused by wildfires. If you reside in a high-risk location for wildfires, you should examine your insurance coverage.

Is Earthquake Damage Covered By Homeowners Insurance?

A normal homeowners insurance policy will not typically cover earthquake damage. A separate policy is required to cover earthquake damage. Several companies in our rating, including several of our top-rated companies, such as Lemonade and Amica, provide earthquake insurance, albeit Lemonade only provides earthquake insurance in California.

Is Storm Damage Covered by Homeowners Insurance?

The response will be determined by your unique policy as well as the manner in which the harm was sustained. In general, damage from lightning, hail, and wind will be covered by a regular policy. However, if the damage is caused by flooding as a consequence of a storm (such as storm surge in a hurricane), it will most likely not be covered by a regular policy and will instead be covered by a flood insurance policy.

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