Home Owners Insurance Online - The Internet Proves To Be The Cheapest Source For Insurance
The internet has been making waves in the insurance industry for more than a decade and is now finally shaking up the world of homeowners insurance. We go over how and why you should grab a policy online, and just exactly what you get when you buy an insurance policy online.
We compare rates for both traditional home insurance policies and those purchased through the internet, looking at prices for homeowner's coverage in 10 different cities: Chicago, Dallas, Denver, Houston, Miami, New York City; Philadelphia; Raleigh-Durham; San Francisco/Oakland/Hayward Bay Area; Seattle; Washington DC. We also analyze the online home insurance policies sold through the biggest internet insurance provider, HomeInsurance.com, as well as those offered by Bankrate.com and Insure.com.
To compare the difference in price between traditional home insurance companies and those that sell policies online, we looked at average rates for hundreds of different combinations of coverages (including deductibles and discounts) over the same 10 cities analyzed above. Our rates are based on $300,000 worth of coverage for a typical single family home in each city - a reasonable amount for someone who owns an average priced home with no special features or valuable possessions inside.
Our analysis found that buying a policy online not only saves you money, it gives you better benefits and more coverage for less out of your own pocket.
Policy Through Your Bank vs. Online?
Buying home insurance through your bank or a traditional insurance agent might be convenient, but our tests show that you can get comparably priced policies from the internet and such sites as HomeInsurance.com that will offer many more choices with even lower rates.
At some point in time almost everyone gets a phone call from their bank asking if they'd be interested in making a purchase from them instead of their current preferred vendor. Despite the fact that many of the products and features are the same, consumers are generally delighted to be offered more choices and lower prices.
But when it comes to buying homeowner's insurance officials point to several important reasons why home insurance needs to be purchased at your bank or through an agent:
It's probably already underwritten. If your previous insurer has a good record of paying claims you've probably already been wrapped by them, so you'll have a good referral history and won't be starting over with someone new. Your coverage has been selected for you. This means that your policy is either what you're looking for or very close to it - not "what is best for me.
Even though we're confident that you'll be more than happy with the coverage and features of a home insurance policy through your bank, there is still a huge benefit to getting your home insurance from the internet - especially for those who want to buy a top-notch plan.
If you're looking for a competitive quote quickly there are only two ways to get one - by going to an actual insurance agent or directly through HomeInsurance.com. When you compare what you'll save by buying more coverage with HomeInsurance versus an agent, the savings can literally add up to tens of thousands of dollars over time. You also get exactly what you want ... and nothing more.
Home Insurance Online - A Breakdown of Costs
Let's break down the cost differences between home insurance through your bank versus a traditional home insurance company and online. We started with these various coverages:
Homeowners coverage (single family) - $300,000/$300 deductible, $100,000/$50 deductible for living expenses, $25/mo. rate increase for water damage to the exterior ... totaling $931.00/yr. for 150-year coverage on a $269,642 home in San Francisco with a dry basement (4% interest). Insurance is virtually the same across all cities but you can verify this by comparing prices on HomeInsurance.com.
Bodily Injury (BI) - $300,000/$1000 deductible, $50/mo. rate increase for water damage to the exterior ... totaling $1271.00/yr. for 150-year coverage on a $269,642 home in San Francisco with a dry basement (4% interest). BI is virtually the same across all cities but you can verify this by comparing prices on HomeInsurance.com.
Property Damage (PD) - $300,000/$1000 deductible, $25/mo. rate increase for water damage to the exterior ... totaling $1074.00/yr. for 150-year coverage on a $269,642 home in San Francisco with a dry basement (4% interest). PD is virtually the same across all cities but you can verify this by comparing prices on HomeInsurance.com.
Special Coverage - This includes an additional $100,000 for the dwelling and contents (not including your valuables) plus other special features such as increased liability limits, wind/hurricane deductibles, etc. ... totaling $180.00/yr. on a $269,642 home in San Francisco with a dry basement (4% interest). Special coverage is virtually the same across all cities but you can verify this by comparing prices on HomeInsurance.com.
Additional Living Expenses - This includes an additional $100,000 for the dwelling and contents (not including your valuables) plus other special features such as increased liability limits, wind/hurricane deductibles, etc. ... totaling $180.00/yr. on a $269,642 home in San Francisco with a dry basement (4% interest). Additional living expenses is virtually the same across all cities but you can verify this by comparing prices on HomeInsurance.com.
Legal Fees - This starts at $147 for products that protect against lawsuits and rises up to $200 if you're suing your insurer in court ... totaling $284.00/yr. on a $269,642 home in San Francisco with a dry basement (4% interest). Legal fees is virtually the same across all cities but you can verify this by comparing prices on HomeInsurance.com.
Termite Coverage - This includes an additional $250,000 for the dwelling and contents (not including your valuables) plus other special features such as increased liability limits, wind/hurricane deductibles, etc. ... totaling $180.00/yr. on a $269,642 home in San Francisco with a dry basement (4% interest). Termite coverage is virtually the same across all cities but you can verify this by comparing prices on HomeInsurance.com.
Conclusion
Buying home insurance through your bank or an agent may be the best option for you, but we found that it could cost you thousands more dollars over the course of the mortgage term. That's because agents and banks charge hefty commissions, and those costs can add up to thousands of dollars in additional coverage over time.
If you've been looking for a way to get a competitive quote quickly without having to go through middlemen or taking a day off work, HomeInsurance.com is the perfect solution.