Best homeowners insurance companies for March 2023

Best home insurance companies in March 2023

The top 10 home insurance companies

How to compare the best home insurance companies

Each of the home insurance companies listed here have unique strengths, but not all of them will be the best fit for your needs. Although comparing homeowners insurance carriers can seem daunting, you might find this list of steps helpful to keep you on track:

1. Decide how much coverage you need. Home insurance is individualized, and a coverage package that’s best for you might not be for another. Determine what level of coverage and optional add-ons you need to best tailor your quote for your unique circumstance. If you’re in doubt, you may find it helpful to seek advice from an insurance professional.
2. Consider your priorities. Are you looking for diverse policy options? Do you need the cheapest rates and, thus, plentiful discount opportunities? Perhaps customer service is at the top of your mind. Knowing what you need in a homeowners insurance policy can help narrow down the list of companies from which to request a quote.
3. Request quotes. Many companies will allow you to request quotes online, but others may require you to speak directly with an agent. Regardless of how you request your quote, you may want to be consistent and ask for the same (or similar) coverage options from one carrier to the next. This can help you compare home insurance quotes apples-to-apples.
4. Ask questions. Home insurance can be complex, but taking the time to ask questions about the carrier’s coverage details may help you make the most informative choice about your policy’s inclusions.
5. Make a list of pros and cons. Once you have your quotes in hand, making a list of pros and cons for each company may help you find one company that stands out from the rest.

What does homeowners insurance cover?

Standard home insurance typically covers damage to your home, detached structures and personal property, although the way that your policy responds to damage depends on the type of policy you have. Your liability exposure is likely also covered. Standard policies typically contain these coverage types:

• Dwelling coverage: This is the main coverage in homeowners insurance and covers your home and any attached structures for damage not specifically excluded in your policy.
• Other structures coverage: Also called “detached structures coverage,” this is usually 10-20 percent of your dwelling amount and covers things like fences, sheds, gazebos, detached garages and in-ground swimming pools.
• Personal property coverage: This part of your policy covers your belongings, like your furniture, clothing and decor. Your personal property coverage is generally 50-75 percent of your dwelling amount, although you might be able to increase it if necessary.Your personal property coverage is generally 50-75 percent of your dwelling amount, although you might be able to increase it if necessary.
• Medical payments: This coverage pays for guest injuries regardless of fault, up to the coverage limit.
• Liability coverage: If you damage someone’s belongings or if someone is hurt on your property and you are found at fault, your liability coverage may pay the damages and your legal fees.
• Additional living expenses: Additional living expenses (ALE), also known as loss of use, pays the costs of living while away from your home if it’s uninhabitable due to damage caused by a covered property claim.

Keep in mind, though, that all policies are different; you can often add endorsements to bolster your policy with more coverage. And home insurance comes in several different types, all of which cover different types of losses.

What are the types of homeowners insurance?

Given the wide variety of homes, there are many different types of homeowners insurance policies for every situation. While the standard HO-3 policy is what we typically refer to when discussing homeowners insurance, there are actually eight different policy types, each one best suited for a different type of home or insurance need:

• HO-1: As the most basic type of home insurance, an HO-1 policy provides coverage for the structure of your home for named perils only. There is no coverage for your personal belongings, additional living expenses or liability. Insurers rarely use this policy form.
• HO-2: This policy type offers expanded coverage for personal property, liability and additional living expenses, but for named perils only.
• HO-3: Widely considered the standard home insurance policy, this policy type comes with all the coverage options in the HO-2 plus medical payments coverage. Unlike the first two types of home insurance policies, the dwelling in an HO-3 is covered on an open perils basis.
• HO-4: An HO-4 is intended for renters as a solution to insure their personal belongings and provide liability coverage. As renters are not homeowners, this policy does not insure the structure of their home.
• HO-5: As an open-peril policy, an HO-5 expands coverage for dwelling and personal belongings to all perils except those specifically excluded.
• HO-6: A condominium owner’s policy insures the interior of their unit, as the exterior and shared spaces may be covered by the master condominium policy. It also insures the owner’s personal belongings and provides liability coverage.
• HO-7: An HO-7 insurance policy is for mobile homes and manufactured homes, such as RVs, trailers, modular homes and sectional homes. It insures both the structure of the home, as well as personal belongings and liability, medical expenses and additional living expenses.
• HO-8: The HO-8 policy type is a named peril policy that only covers 10 perils. It is intended for homes where the repair or replacement cost may be higher than its resale value, such as older or historical homes, or architecturally significant homes.

How to buy homeowners insurance

Once you are ready to purchase homeowners insurance, here is an overview of steps to follow:

1. Estimate what you need to be insured. Starting with your home, consider the square footage, remodels or renovation and any external structures like a swimming pool or detached garage that needs to be insured. Also take inventory of personal belongings, especially if you have any high-value items that might benefit from a scheduled personal property endorsement.
2. Calculate how much coverage you need. After thinking about what and how much you own, you can start to determine your dwelling, personal property and liability coverage amounts. You don’t need to work up exact figures, but having an idea of how much home insurance you need might help you ensure your quotes are at a proper level. An insurance agent can also help review the coverage limits to ensure you have the right amount of insurance. Depending on where your home is located, you may also need flood or earthquake insurance, which is purchased separately.
3. Choose which insurance companies to request a quote from. Researching the top home insurance companies can reveal financial strength ratings and customer service reviews, which can help you narrow down your options. Requesting quotes will give you a better picture of policy offerings, estimated premiums and discount opportunities. Requesting quotes from more than one carrier will give you the best chance to see which company offers the best coverage for your needs and budget. Additionally, depending on how you want to manage your policy, this can be a great way to familiarize yourself with the company’s online services or connect with local insurance agents.
4. Finalize the policy. Once you have made a decision, you’ll need to make a payment to bind, or finalize, the policy. If you are switching carriers, you can choose to have your new policy begin when the old one ends, or you have your new policy start immediately. If that’s the case, you’ll need to issue a request to your old insurance company to cancel the policy and request a refund for any unused premium.

Home insurance industry trends

Signs show that our red-hot inflation could be cooling, but the economic situation remains uncertain. According to Bankrate’s 2023 annual emergency savings report, almost half of American adults have less money saved (or none at all) compared to last year.

Some homeowners may try to cut costs by saving on their home insurance, but this could prove challenging. According to proprietary premium data from Quadrant Information Services, the national average homeowners insurance rate for $250,000 in dwelling coverage rose three percent from 2022 to 2023 (from $1,383 to $1,428). However, rates in some states have risen more than in others. For instance, Florida’s average homeowners insurance rate increased by about 20 percent.

Historic labor shortages and inflation are some of the post-pandemic woes plaguing the home insurance market. An increased frequency of catastrophic weather events, excessive litigation and, in some states, rising insurance fraud are also factors. While shopping for a lower home insurance quote may still be worthwhile, finding a lower rate could take more work than in years past.

Bankrate continually monitors homeowners insurance rate trends to give our readers information they can use to make empowered, informed decisions about their policies. We also asked industry experts to shed some light on the current market and to provide tips that consumers might use to ease some of the pressure they may feel when receiving their policy renewal this year.   

Industry experts weigh in 

Bankrate spoke with three leading insurance industry experts for insight into different aspects of the current home insurance market: 

Frequently asked questions