Base on the fact that we have many things more exciting than moving into a brand new home, particularly if the home reflects the homeowner’s tastes. And again what comes as a surprise to many new homeowners, though, is the discount they enjoy on homeowners insurance.
So let’s assume you’re a first-time homebuyer or a seasoned homeowner looking to upgrade to a newer home, your mortgage lender will require you to get home insurance for the new property. All Homeowners insurance comprises some crucial coverages that will protect the dwelling’s structure, your personal property, liability and more.
Therefore, incase you’re in the process of closing on the property, now is the time to start shopping around for new home insurance to insure your investment even if it’s still under construction.
One thing you should know is that insurance companies are partial to newly constructed homes, so they’re cheaper to insure than an older home. Again a new home construction discount is also a common offering by many companies and is often one of the biggest discounts you can get.
Be sure to explore our free and helpful guide to finding insurance for a brand new house, and the best ways to save even more on your insurance rate.
This time around, we’ll give you a sense of why homeowner’s coverage is cheaper for new construction, tell you which companies offer the highest level of coverage at the lowest price, and remind you of other factors you may want to consider before deciding on an insurance company.
Below is the list of best homeowners insurance for new construction
USAA: Best for military members and their families
Progressive: Best for low pricing
Amica: Best for its dividend option
State Farm: Best for comprehensive coverage
Nationwide: Best for optional replacement coverage
Way to reduce the cost of your homeowners insurance premiums
It doesn’t matter how low an initial quote may be, there are steps a homeowner can take to reduce their homeowner’s premium even more. For example:
- When Shop smart by comparing one policy to another after all discounts are factored in. Many people have made the mistake of underestimating how much discounts can lower their homeowners insurance premiums. And speaking of discounts, apply for every one you’re eligible for.
- Bundle insurance products. Bundling two or more insurance products (like homeowners, auto insurance, and life insurance) through the same company will almost always land you an enviable discount.
- Maintain good credit. Another thing that surprises some people is the role their credit score plays in insurance costs. Based on years of studies, the insurance industry says credit score plays a role in how many claims are made. The higher a person’s credit score, the less likely they are to make a claim. For that reason, insurers tend to offer lower rates to homeowners with a strong credit score.
- Upgrade security. Whether the upgrades include deadbolt locks, smoke detectors, a burglar alarm, or fire extinguishers in the house, a homeowner is likely to receive a bit of a discount for each.
- Consider perils common to the area. For example, someone who lives in Alaska may want to have an older home retrofitted to better withstand an earthquake. A homeowner in Florida may add storm shutters, and someone living in Oklahoma may consider upgrading their roof to one that is able to survive windstorms and other disasters. The more a homeowner does to protect their home from peril, the less an insurer believes it will have to pay to repair.
Note: You need to make sure the coverage limit for any particular peril matches the risk of that peril occurring. Representatives of the best home insurance companies are happy to help you focus on how much home insurance you need.
Ways to determine the best insurance for your new home
Another thing is that Homeowners insurance is not a one-size-fits-all proposition. What works for you may not work for a neighbor with a similar home. Here are five steps to take to determine which homeowners insurance policy is the best fit for you and your property.
- Again make a list of what you want in a policy: Do you want minimum, barebones coverage or do you want a policy that will rebuild your home if it’s destroyed?
- Also determine how much of a deductible you’re comfortable with: The best move with a deductible is to put the funds away where they can easily be accessed. For example, if your deductible is $1,000, put that money in a special savings account that draws interest. If you never need it, great. But if you do need it, you’ll have it.
- Then think about what you own and what you’d be upset about losing: For example, if you have a great wine collection or unusual stained glass windows, you want to make sure those things will be covered in the event of peril.
- Also talk to agents from several different companies: Price is important, but other factors — like the financial stability of the company and customer service — also matter.
- After comparing the coverage and premium costs of three or more insurers, choose the one you suspect will help you rest easiest at night. For some, basic coverage is enough. Others are most comfortable with extra coverage in place.
Just as most people says, a person’s home is one of their largest and most important assets, and it’s true. When it comes time to protect that asset, it is the wise homeowner who takes the time needed to explore their options.
The Cost of Home Insurance for New Construction
Before we put the pen down, keep in mind that the newer the home, then the cheaper it will be to insure. The price difference in insuring a new construction versus a 10-year-old house is 53%. Rates climb incrementally as the home ages beyond 30 years.
And of course, compared to a home built in 1990, you can save more than a lot more a year in insurance costs by opting for a new build. We are sure this well written guide will have help you make decision on your Home Insurance options.
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