An Easy Guide to Change Your Homeowners Insurance Provider

Contrary to popular misconception, you are not stuck with your home insurance provider for the life of your mortgage. Most homeowners interested in switching insurance companies look to save money on rates. In other cases, you might want additional coverage for issues that your current company does not cover. Whatever your reason, use the guide below to switch providers.

Check Your Current Policy's Terms and Conditions

First, review the terms and conditions of your current policy. Navigate to the declarations page, which has information like the effective dates, deductibles, and coverage limits. If the effective date is close, contact the company to prevent automatic renewal.

Check if the company charges early cancellation fees or refunds unused premiums if you cancel the policy mid-term. Cancellation fees can be pretty significant, so consult your provider. Also, ask if you have ways to avoid the penalties.

Identify Your Coverage Needs

Insurance requirements change over time. Certain life events, like marriage or children, changes your priorities. Similarly, you may have added other structures to your property like a shed, deck, and carport. Remember to factor in any upgrades or renovations you have made.

In addition to the damages in a standard policy, you may want flood insurance, earthquake insurance, and lack of maintenance damage. Some companies cover priceless jewelry and antiques, which is excellent for family heirlooms. And if you have certain dog breeds, additional coverage might be necessary.

Shop for Providers

The best way to compare insurance providers is to get quotes from at least three companies. Fortunately, online insurance marketplaces can simplify the process. Also, you can check online reviews from other homeowners and identify well-reputed providers.

When contacting insurance companies, pay attention to their wait times. If contacting an agent takes too long, be wary of poor customer service. Next, let the agent know your needs and the coverage you need. The best insurance provider has excellent customer service, affordable rates, and a good reputation.

Buy the New Policy Before Cancelling the Old One

Apply for a new homeowners insurance policy after you identify a suitable provider. Understand the policy's details to ensure you get a better deal. Check the deductibles, sub-limits, riders, and coverage. Also, ensure that the insurance agent understands all your requirements.

Buy the policy while the old one is still in place to prevent coverage gaps. However, check your previous provider's notification period to avoid penalties. Also, you have to pay premiums on the new policy yourself, even with an escrow account.

Currently, homeowners policies take as little as one to three days to take effect. Also, ask about any discounts for new buyers to save some money. Pay attention to the effective dates when buying a new policy. For example, if your old policy ends on October 31, you can quote the new policy's effective date as October 31.

Notify Your Lender

Most homeowners include their insurance payments with the monthly check. In turn, the lender sends out the payments from your escrow account. This arrangement assures the lender that their investment is well-insured. This also means that you need to notify the lender of any changes to your homeowners insurance. As a result, the lender directs the payments to the right company.

You can switch homeowners insurance providers at any time, although you have certain steps to take. Once you find a suitable alternative, buy a new policy first and then cancel the old one. Remember to notify your mortgage lender to ensure the payments go to the new company. For additional queries, contact us at The Policy Center Inc. We look forward to helping you.