Courtney Aubrecht, freshome.com
You’ve done it. You’ve researched, reviewed, and assessed your next dream home and found the perfect match.
Beyond purchasing your new home, the next task to cross off the to-do list is finding the perfect homeowner’s insurance policy to protect it. In the event of an accident, having your home and your possessions covered will be the difference between a quick recovery and a very long struggle.
This doesn’t necessarily mean homeowner’s insurance is easy to understand, however. Assessing the value of your home or your property can be nerve-wracking since you want to make sure everything is covered without spending more money than is necessary. After all, at the core of this decision is protecting one of the biggest investments of your life.
Here at Freshome.com, we have learned as much as we can about the best homeowner’s insurance in Delaware so you can make an informed decision. We found quotes for the top insurance companies in the state, assessed the customer satisfaction and financial ratings of others providers, explained what you need to know when you’re ready to start looking for quotes, and, hopefully, answered all the questions you may have about homeowner’s insurance.
The Best Homeowners Insurance in Delaware
We found quotes from the top three recommended insurance companies to give you a general idea of what to expect. In the perspective of Michael Doyle, a real estate agent for Century 21 Emerald, the average amount of coverage that his clients deal with is generally between $300,000 and $400,000. Keeping within this average, we found a colonial-style home with three bedrooms and two baths that we used to gather quotes from Amica, Liberty Mutual, and State Farm.
Each quote was for an HO3 policy, which is the most commonly used — and highly recommended — homeowner’s insurance policy. The benefit of an HO3 policy is that it covers the losses from the standard 17 perils (fire, lightning, theft, vandalism, and others) as well as virtually anything else you can imagine, like the water stains on your ceiling from condensation in your attic or damage to draperies that froze to your window.
Beyond the three quotes we gathered, we analyzed other standout insurance companies that met a specific criteria of a J.D. Power Overall Satisfaction rating of three stars or more and an A.M. Best Financial Strength Rating of B+ or higher. We also listed their financial strength rating from Moody’s or Standard & Poor’s Global.
What You Should Know Before Getting a Quote
Getting a quote is the first hurdle in finding the best homeowner’s insurance policy. Now that you know what companies you’d like to get quotes from, it’s time to learn a little more about homeowner’s insurance and what information you’ll need when contacting an insurance agent.
Homeowner’s insurance protects both your physical house as well as your personal possessions in it, including appliances, furniture, and clothing. In addition, it provides liability coverage should someone on your property be injured. In Delaware, a general homeowner’s insurance policy is sometimes required in order to get a mortgage or even purchase a house.
Determining what coverage you need depends on a number of factors. Sometimes it may feel difficult to find the best policies to safeguard your home, but with enough time, research, and patience you can rest assured that the pieces will fall into place.
The best strategy is to shop around, and sometimes your real estate agent may be the best resource for this. We spoke with Michael Kelczewski of Brandywine Fine Properties Sotheby’s International Realty. He explained, “I try to stay within a real estate scope and connect clients with insurance brokers to recommend various policies…A main tenant of a successful agent is a professional network.”
Some companies may offer exclusive benefits, deals, and promotions that may be beneficial and save you some money. By shopping around, you can gather these special features and determine if they work for you. At the root of it all, though, is making sure your home and possessions are completely covered.
What To Know While Gathering Quotes
Homeowner’s insurance will cover the assessed value of your home, or the amount of money it will take to repair or rebuild the structure should it be damaged or destroyed. It is important to know that this number may be different from the market value of your home or what you bought it for.
If you do not have a recent assessment of your home, you can determine its assessed value by — logically — having it assessed. This can incur a hefty fee, however. Fortunately, most insurance agents will be able to determine the value of your home by reviewing past tax records or by considering the following:
- Construction materials used
- Total square feet of the building
- Number and types of rooms
- Type and style of garage or carport
- Any special features of the home, such as pools or decks
As we mentioned earlier, another significant coverage homeowner’s insurance provides is the replacement of your possessions. After you have determined the replacement cost of your house, the next step will be itemizing your possessions. The best strategy for cataloging your possessions? Make a home inventory, complete with photographs or videos of all that you own.
A home inventory will allow you to estimate the value and replacement costs of your property, ensuring you will have sufficient coverage. It will also create a record of what possessions you had before disaster struck so you can provide your insurance company with a comprehensive list of what needs to be replaced.
To do this, first make a list that contains every piece of furniture, every appliance, and every important item for every room of your home. Included in this list should be artwork, window blinds, dishes and silverware, electronics, and even the number of CDs and DVDs you have.
For clothing, count every article of clothing. Make sure you don’t forget about your basement, attic, or garage. You can use this handy blank home inventory form from the Delaware’s Department of Insurance to keep track of all your possessions. Make sure you update it once a year to ensure you’re still receiving adequate coverage.
Typical insurance policies cover personal property between 50 and 70 percent of the policy limit. This means if your policy is worth $100,000, then $50,000–$70,000 will be given to cover any lost possessions. Additional coverage may be purchased, and limits do exist for valuable possessions such as jewelry, computers, and firearms. See the FAQs below to get more information.
What else is included in my homeowner’s insurance policy?
Another inclusion is liability which covers medical expenses and other losses should someone injure themselves on your property. It may also cover injuries in accidents (beyond auto accidents) caused by you, a family member, or even a pet when you are away from home. This can include accidentally hitting a pedestrian on your bike or if your dog bites someone at the park.
There are two types of coverages under the liability section: personal liability coverage and medical payments coverage. The former pays for any damages to other people or their possessions while on or passing through your property. Should you be sued, this section of your policy may cover the cost of litigation. Note that this liability coverage only applies if it has been determined that the cause of injury or damage was brought about by negligence.
For medical payment coverage, your insurance will typically pay the medical bills of others who were injured either on your property or by you, a family member, a pet, or a household employee. Payments will typically last no more than three years.
The coverage amounts for both of these sections will be displayed when you get a quote. When you purchase your insurance, review the liability coverage on your policy to understand what it covers and what it does not. Larger amounts of liability coverage is typically available for purchase at a relatively low cost.
Finally, it is also important to consider temporary living expenses should your property be damaged or destroyed. While it is being repaired or rebuilt, your policy should cover some, if not all, of the costs for you and your family to temporarily relocate. Make sure you review this section in your policy as well.
Ultimately, “you get what you pay for,” said Doyle. “You can save $200 on your insurance but if you get a $10,000 claim and your insurance doesn’t pay out, it’ll take years to hit even.”
Why are Delaware’s rates so low?
Looking back at the quotes provided earlier in this article, you may be wondering how Delaware stacks up compared to other states in the country. Considering the quotes earlier in this article, the best homeowner’s insurance in Delaware actually sounds like a pretty good deal compared to the rest of the country.
It’s true. According to the Insurance Information Institute, Delaware has one of the lowest premium rates compared to other states. The average annual premium for Delaware residents is $709, while the national average is $1,096.
In the eyes of Insurance Commissioner Karen Weldin Stewart, the fact that Delaware offers the seventh lowest homeowner’s insurance rates in the U.S. (based off of the most recent data in 2013) is a mark of honor for residents.
It does raise the question: why are insurance rates for Delaware so low? There are a number of reasons. Lower premiums are a result of increased safety measures taken in your home, including burglar alarms, modernized electrical or water systems, and fire sprinklers or extinguishers. Additionally, most coverage holders can find discounts when they bundle their home, auto, and other insurances under one company. A higher deductible will result in lower premiums as well.
Another reason why Delaware has maintained such a low premium rate is because of a statewide ban on “price optimization,” as of 2015. When implementing price optimization, insurance companies determine an individual’s premium not only based on determined risk, but also on consumer behavior. The company will break down a number of “non-risk factors” — such as a customer’s likelihood to renew coverage or the most a customer will pay before seeking out coverage elsewhere — in order to set rates, something that the state of Delaware has logically deemed unlawful and discriminatory.
What are common coverage gaps?
Common coverage gaps for homeowner’s insurance in Delaware include flood insurance and coverage to replace valuable personal items. Additionally, if you are running a business or provide day care services out of your home, additional liability coverages may be needed in order to remain lawful.
Another add-on to include with your premium is the relatively new Identity Fraud Expense Coverage. This coverage, for an extra cost, will provide financial support for you or a family member if you are a victim of identity fraud. Expenses covered may include long-distance telephone calls to creditors, notary service costs, and the cost of making copies of documents.
The best strategy is to have an open and honest conversation with your insurance agent to find the best coverage for your needs.
What is valuable possessions coverage?
There is usually a limit under most policies that determines how much you will be reimbursed for certain kinds of items, including jewelry, fine arts, camera equipment, coin or stamp collections, computer equipment, and satellite dishes. The typical coverage limits for these items are as follows:
- $1,000 for loss by theft of jewelry, watches, or furs
- $200 on money and coins
- $1,000 on stamps, tickets, securities (stocks), deeds, and passports
- $1,000 for trailers (not used for watercraft)
- $2,000 for loss by theft of guns and firearms
- $2,500 for loss by theft of silverware
- $5,000 for computer equipment
These numbers are average, so it will be important for you to talk with your insurance agent or review your policy to know the exact amount of coverage you have for these items. If this coverage does not seem satisfactory, speak to your insurance agent to discuss adjustments.
What about flood insurance?
Standard homeowner’s insurance does not come with protection against floods. Some flood insurance companies provide their own flood coverage, however, more often than not the flood insurance you’ll purchase is backed under the National Flood Insurance Program through the U.S. federal government.
The premiums for coverage are determined by your home’s risk of flooding as well as the age and construction of the home, but the average annual premium is $438, nationally.
There are excellent tools online, such as Flood Tools, to research your flood risk and look at the county-wide flood claims and losses over the past 10 years.
Are there any other ways to save on premiums?
When continuing conversations with agents, it is a great idea to address any special discounts offered by insurance companies. Some may offer reduced premiums for special conditions, such as staying with the company for a certain length of time, updated plumbing or electrical systems, or if there are no smokers in your home.
You’re equipped with the information you need to gather quotes and find the best homeowner’s insurance in Delaware for your home and your family. Remember to catalog the value of your possessions as well as determine the replacement cost of your home to make sure you’re getting adequate coverage. Annually updating your information, possessions, and coverage will ensure you and your home will be protected should disaster strike.
And lastly, take your time! It is never a good idea to jump at the first quote you get. Finding the best policy takes time; by considering all options available, there’s a better chance you’ll end up with exactly what you need.