The search for the best home insurance rate may seem complicated if you just go by the first page of the search results. It takes time to visit each insurance website and submit a request for a quote, then wait for a response. Would you prefer to speed up the process? Here's what to know about sharpening your search for the best home insurance deals.
Your home insurance rate will be based on a combination of factors the insurer calculates after including all the relevant data. Each insurance agency has its own methodology for determining rates.
Here are the main factors an insurance company typically considers:
The older the home, the sooner it may need repairs. Additionally, materials used for older homes may be difficult to replace and expensive due to scarcity.
Both the home's age and construction type can affect repair or replacement costs. The more unique a home is, the greater the need for additional skilled labor.
Your roof can be expensive to replace, running several thousand dollars. Certain types of roofs, such as metal roofs, are more durable than others. A roof with multiple leaks can be extremely costly to fix, which is why poor roof conditions can equate to a higher insurance rate.
Where you live has a dramatic impact on insurance rates, as high-crime area residents must pay more in insurance for the higher risk. Living near a body of water is considered high risk due to the potential for flooding. Meanwhile, living near a fire station or fire hydrant can help reduce the home insurance rate.
You can increase the value and safety of your home through remodeling to meet modern standards and improve curb appeal. In some ways, it can result in lower insurance rates, such as investing in an alarm system. However, insurance rates also go up as the value of a home rises, which in turn pushes up replacement costs.
Insurance companies track your credit history to make sure you pay bills on time. Everyone who buys insurance has an insurance score that is known to the insurance industry. Garnished wages, bankruptcy, and high debt can jeopardize your insurance score.
It's important to know the difference between replacement costs and actual cash value (AVC). Replacement costs reflect what it would cost to replace the same home or components, whereas ACV reflects the asset's value minus depreciation. The cost of renovation may be higher than what the value of the asset was worth before the damage due to rising costs of labor and materials.
Would you like to know an easy path to finding the best home insurance rate for your needs? At Reata Insurance Group, our team will help you find the right plan. Contact us today to get started on your customized home insurance policy.