Best Homeowners Insurance
The best homeowners insurance has the right scope and level of coverage for your specific needs, and is backed by a financially sound insurer which has earned a reputation for fairness in meeting valid claims. That’s the formula for the best policy in the market today.
But it’s not all about the insurer. It’s about you too, and in particular the value of your assets and the potential liabilities which you might be exposed to. Yes, it’s about the right company, but it’s also about the right coverage.
Standard homeowners policies usually provide coverage in four principal areas, namely property damage, personal liability, medical payments and additional living expenses. However, the first two of these are by far the most important, for the reason that a lack of coverage in these areas can have a potentially serious effect on your financial well-being. In particular, an inadequate amount of personal liability insurance is in itself a risk to your property assets, because those assets can be targeted in any lawsuit taken against you.
We are independent of any insurer in the market, so we are not attempting to sell you a policy. Our aim is to educate consumers about types of coverage, exclusions, premium rates, deductibles and other important aspects of homeowners’ policies, so they have the knowledge they need to arrange appropriate protection for their circumstances.
Best Homeowners Insurance Companies
The best homeowners insurance companies offer affordable policies and have a history of excellent customer service and fair claims settlement. Furthermore, they have the financial resources necessary to continue operating over the long term and pay claims when they arise. There are numerous insurers competing in the market today, but finding the best companies is not always easy.
Size
Based on direct premiums written, the ten largest underwriters of homeowners insurance are shown in the table below1:
| Rank | Insurance Company | Direct Premiums Written in 2009 ($000) | Market Share |
|---|---|---|---|
| 1 | State Farm | $14,737,236 | 21.6% |
| 2 | Allstate | $6,837,286 | 10.0% |
| 3 | Zurich (parent company of Farmers) | $5,066,034 | 7.4% |
| 4 | Liberty Mutual | $3,461,188 | 5.1% |
| 5 | Travelers | $3,082,155 | 4.5% |
| 6 | USAA | $2,969,698 | 4.4% |
| 7 | Nationwide | $2,909,148 | 4.3% |
| 8 | Chubb | $1,772,268 | 2.6% |
| 9 | American Family | $1,460,618 | 2.1% |
| 10 | The Hartford | $1,122,780 | 1.7% |
These 10 companies only make up 63.7% of the market, and there are many other companies competing for your business. Size should not be taken as a measure of the quality of the company’s product offerings or customer service. There are several other more relevant measures that should be given due consideration before selecting an insurance company. These include financial strength and customer satisfaction.
Financial Strength Ratings
Before taking out any policy, you must have confidence in the company’s financial strength. An insurance policy is worthless if the company backing it doesn’t have the ability to pay out when you make a claim. For example, the insurer needs to have the resources and reinsurance in place necessary to survive the demands placed upon it arising from a large scale natural disaster such as a hurricane. Financial strength ratings, assigned by independent rating agencies, provide a measure of an insurer’s ability to meet its ongoing claims obligations.
Customer Satisfaction
Even though an insurer has the ability to pay its claims, that doesn’t mean it will pay out when you need it to. Many consumers report difficulties in dealing with their insurance company, including denial of claims, delay tactics and other impediments to obtaining a fair settlement. Whilst every consumer’s experience is likely to vary, customer satisfaction surveys provide a very good overall benchmark based on the past experiences of real customers. One of the most comprehensive and widely recognized surveys is the annual National Homeowners Insurance Study by J.D. Power and Associates. This study provides a ranking of homeowners insurance companies based on consumer satisfaction.
Learn about Home Insurance
The more you learn about home insurance the better equipped you will be to choose the most appropriate types and amounts of coverage for your particular circumstances.
Homeowners insurance covers much more than your house. A typical policy has six categories of coverage, including liability protection.
Condo insurance is designed to supplement your condominium association master policy and prevent you from having to pay for duplicate coverage.
Townhome insurance is similar to condo coverage; however there are some key differences. Be sure to choose the right policy for your needs.
Landlord insurance is designed for home owners who rent out all or part of their property. Protect your investment with the right policy.
Home Insurance Resources
There is a range of home insurance resources available externally in both the public and private sectors. In the public sector, state insurance offices are an important resource for consumers both before and after they buy a policy. The organization which represents state regulators, the National Association of Insurance Commissioners, operates a very useful website at Insure U Online, and that site has a consumer library which has specific information about homeowners insurance.
For those who live in flood-prone areas, the National Flood Insurance Program is an essential resource for both learning about flood risks in their area and for arranging a flood coverage.
In the private sector, the Insurance Information Institute provides consumers with helpful tips and in-depth guides on various types of coverage, together with statistics by state. Similarly, Kiplinger produces regular feature articles for consumers on every aspect of homeowners coverage. The Property Insurance Coverage Law Blog and its associated Condominium Insurance Law Blog produce frequent postings on homeowners insurance issues from a legal perspective.
For those who have sustained property loss or damage, public adjusters are often called on to assist in preparing, filing and adjusting insurance claims, and in helping home owners in dealing with insurance companies which have denied their claims. There are also consumer websites which deal exclusively with insurance issues, such as United Policyholders and the Insurance Consumer Advocate Network, and the more general consumer website, the Consumer Federation of America.
- Source: SNL Financial LC
