Understand How to Shop for and Buy House Insurance

If you're new to house insurance, don't be afraid. It's not nearly as complicated as it seems. Yes, there are several things you need to watch out for, but even a basic understanding of house insurance is enough to find a quality plan that fits your needs. Plus, by using NetQuote, you can consider quotes and review policies from a number of different insurance companies that service your area. Taking this time will help you find an insurance company that can trust. Here's what you need to know to shop for and buy house insurance.

House Insurance: Policies and Perils

There are two basic categories of house insurance policies: Named-perils and all-risk policies. Simply put, a named-perils policy covers only those perils named in the policy. All-risk policies cover everything EXCEPT for explicitly stated exclusions. According to the National Association of Insurance Commissioners, all-risk policies are used by 80% of U.S. households, most likely because they're easier to understand and despite the fact they usually cost more.

    • HO-1: This most basic form of home insurance is a named perils policy and covers what is known as the 11 basic perils of homeownership: fire/lightning, windstorm/hail, explosions, riot or civil commotion, damage from aircraft, damage from vehicles, smoke damage, vandalism, theft, volcanic eruption, glass or safety-glazing material damage.



    • HO-2: This named-perils policy covers the basic 11 perils plus these six: falling objects, ice/snow/sleet, frozen pipes and plumbing overflows, damage from hot water heating systems, and electrical-surge damage.



  • HO-3: This is the popular all-risk home insurance policy. The most common exclusions for coverage include natural disasters, power failure, war, nuclear events, governmental action, and fraud.

Choosing an Insurance Plan: Tips, Choices, and Warnings

    • Market Value vs. Replacement Costs: This could be the single most important decision you ever make for your house. Insuring your home for market value is highly unlikely to give the money necessary to rebuild your home if it's destroyed. With so many mortgages "underwater," it might not even be enough to pay off the bank. For these reasons, many people opt to insure their home for its replacement cost, despite the higher premiums.



    • Natural Disasters and Acts of God: For many homeowners in many locations, floods, earthquakes, tornadoes, and/or hurricanes are the most likely causes for total property loss. Thus, many homeowners are surprised to learn that most house insurance policies don't cover these natural disasters or "acts of God." This doesn't mean you have to leave yourself vulnerable to these calamities, at least not financially. You should be able to buy supplemental insurance for these disasters. Many state governments offer separate insurance plans specifically for the disasters likely to strike your area.



  • Making a Claim: If you've ever had to make a claim on your car insurance, you know that your rates are likely to go up afterwards. Well, it works the same way when you're insuring a house, no matter how faultless you are or how freakishly isolated the claim might be. Worse, if you end making multiple claims in a short period, your insurance might be cancelled altogether. This record will stay with you, too, making it that much harder to get insurance in the future. The point is that you shouldn't assume making a claim is the best financial decision, especially if the claim is barely more than your deductible.

Getting House Insurance Quotes

Trying to find house insurance quotes by cold-calling insurance companies or walking into one of their local offices is a daunting task. Trying to make the best decision for your house in a high-pressure sales situation can be difficult for even the informed homeowner and nearly impossible for the uninitiated. And for this type of "insurance," NetQuote has you covered. Just fill out our quick and easy online form, and we'll match you to the insurance companies most likely to fit your insurance needs. Moreover, these companies will know that we've also matched you to their competitors, increasing the level of competition and putting you in the driver's seat.