How much is my home insurance policy?
Everyone needs homeowners insurance, and in a difficult time like this where insurance is becoming less affordable, it’s important to understand the nuances of how they’re priced and how you can optimize for the best policy possible!
Homeowners insurance can range anywhere from $1,000 to upwards of $10,000 on the highest and most at-risk ends, so its important to understand what factors play into that pricing. Here are some of the most common factors of pricing for homeowners insurance:
1. Location
The location of a home plays a big role in determining the price of a premium, and relies on multiple factors such as:
Temperature
Humidity
Topography
Surrounding vegetation
Whether the property is on a hill
How close it is to other properties
How developed surrounding infrastructure is
And so on. A lot of these factors rely on having reliable transportation or the ability to call an ambulance or fire truck from a secure distance. Surrounding vegetation plays a role in determining how likely a home is to catch fire, which leads to our next point.
2. Structure Science
Your structure is more or less likely to get hit by a natural disaster if they exhibit certain traits, which could increase your premium or straight up result in a denial of your policy if left alone too long. These factors include:
Flammable debris on your roof, around the edges of your home, or touching the sides of your home
Open foundation, like a deck with an underpassage, that allows embers or debris to get lodged under the home
Leaky pipes or ventilation that let air and water into the ceiling or in through the cracks on the side of the home
Logs against the side of your home
Furniture that isn’t anchored down in case of a storm
Any electrical wiring that isn’t fully protected
This list goes on and on but it’s important to have a good idea of what you’re facing when you submit a request for a policy. Improving risk factors on your property gives you a much better chance of getting a lower policy and in extreme cases, qualifying for insurance after being denied.
You can find out a bit more about your property’s risk factors here.
3. Past Claims or Denials
It’s important to note that while it’s not the best, there is more of a chance of being denied or being offered a higher premium if you’ve filed a claim in the past or have been denied insurance by a carrier before. This lets similar carriers know that it will be a harder one to insure, which is why taking precautionary measures before applications is crucial.
If you’ve filed a claim in the past, it’s not the end of the world! There are still options available for carriers that may accommodate higher risk properties. The more you demonstrate your ability to work together with an agent or carrier, the more likely you are to receive a more favorable policy. We advise working with a broker if any of these things relate to you, as it’s easier to have someone on your side along the way.
