How do you get the best coverage at the best price for your homeowner’s policy? It’s essential to choose the right company, the right price, and the right coverage for your specific situation.  

First, what is homeowner’s insurance? Homeowners insurance is a collection of different kinds of coverage such as fire, theft, liability and windstorm wrapped up into a single policy.

Current homeowners should review their policy annually.

Additionally, use these 4 steps to ensure you have the right coverage and for the best price:

1. Understand how homeowner’s insurance coverage is determined.

Coverage is based on the square footage and any custom finishes of your home. It factors replacement cost per square foot to rebuild in case of disaster.   Let your agent know if you’ve made any improvements to the property so it can be valued appropriately.

Your insurance company will most likely require you to purchase coverage that insures 80% of the replacement value of the home.

Also, consider everything of value that you have inside the home as personal belongings. Always be prepared for the worst case scenario.

2. Verify category coverage amounts.

Insurance companies will estimate what your home is worth today and how much it would cost to rebuild. Contact your favorite real estate agent for a second opinion if you suspect the numbers are grossly over or underestimated.

Let an insurance agent know if you’ve got a special art collection or a home office with equipment and supplies. They can inform you about any additional policy riders that might be necessary.

Lastly, make sure that your deductible is set at a price that you can afford in the event that you must rebuild or do extensive repairs to your home. Being willing to pay a higher deductible will reduce your premiums.

3. Educate yourself about flood insurance.

Flood insurance is often optional, unless required by your lender. Hence, most homeowners opt out of flood insurance. If you are on the fence, read my article about flood insurance and why we wished we had purchased it.

Also, basements are practically the norm in Georgia, so it’s important to understand that being covered for the water damage from water intrusion in your basement is different than having flood insurance. Contact your insurance agent to learn about the differences.

4. Determine if you need to upgrade your homeowner’s insurance policy and coverage.

Lastly, meet with your insurance agent to discuss what coverage you have now and let them know about any new home improvements or any new possessions that should be included in your policy. 

Your agent will come out and document these upgrades, take photographs, and let you know if you will need additional coverage.