Home Insurance?

[destillat]

Why do policies vary so much?
I currently pay $1000 a year... just got a quote for $500, and another for $800.
All seem to have almost identical coverage.
Is that just the way the market is, or are there secret details that I should be looking for?

 

[oldjones]

What you want (but just try to get it) is comparable information about how the companies processed claims and paid out. One way to offer low premiums and still make a profit is to nickel and dime every claimed cost, insist it should have been itemized on a separate rider, or wasn't covered at all. Some respond swiftly and helpfully, others seem to resist and treat the claimant as if they worked for the insurer—"Call us when youy have three quotes". And then there's the Condo Effect: How do they cover damage to your neighbour's place from your fire/accident? Leaving it to you, can lower your premium.

Run a hypothetical where a small fire completely destroys some stuff you have no receipts for, and no formal records. Include jewelry, antiques and the computer you do business on, as well as your place being unliveable until the smoke is cleared, and needing mould inspection, water damage repairs on two floors, as well as the burn repair. Compare their stories.

 

[TeasePlease]

My first reaction would be check the deductibles, but you're right, premiums can differ broadly.

Insuring my condo was pretty straightforward. All the rates were within 10% of each other, so I bundled it with my car insurance.

My house was a nightmare. My extant insurance company wouldn't even offer coverage unless I undertook to make some major renos (knob and tube wiring, etc.). I ended up having to go through a broker who found me a great deal ($800 for the year). We still haggled over replacement values, etc.

My place down south was an even bigger nightmare. It's beachfront, located on an island and situated in a hurricane zone. It took me a month to find insurance. Local brokers were friendly but not very much help. I ended up having to do a bunch of leg work myself. I ended up talking directly to the underwriting companies to ask about their specific risk concerns. Then I looked at how I could address those risks. In my case, it turns out that if I could prove very specific structural elements, I could cut my premiums in half. I had to hire an engineer to get a formal report, but it was well worth it.

I don't think it's as much of a problem up here as it is in the US, but you want to make sure that your insurance company will be around to pay out. On that basis, you should check its ratings. A.M. Best is like S&P for insurance companies. Very handy. http://www.insurancejournal.com/ambest/

 

[destillat]

Thank you!
I checked that website and my current insurer (the most expensive) is rated A.
The other two companies I got quotes from are not rated.