Homeowners insurance is a form of protection that covers your home, personal property, and legal and medical expenses if your home is damaged or you’re deemed liable for an accident that occured on your property. This type of insurance is also often required by mortgage lenders.
While there are a number of companies offering home insurance, not all policies are created equally. To find the best homeowners insurance, check out the table and reviews below, and keep reading to learn more about how these policies work.
Table of Contents:
- Best homeowners insurance companies
- How we determined the best homeowners insurance companies
- How to choose the best homeowners insurance
- What does homeowners insurance cover?
- What does homeowners insurance not cover?
- Are you uninsured?
Best homeowners insurance companies
When searching for a comprehensive homeowners insurance plan, you’ll want to factor in each company’s financial strength, customer service, discounts, and extra coverage opportunities. The ratings below are a start for doing just that.
- AM Best: The financial strength of a company. Ratings range from A++ to E.
- BBB: How likely a business is to interact with its customers. Information is gathered from businesses and public data sources. Ratings range from A+ to F.
- J.D. Power: The opinion of a sample of consumers who have used or owned a given product. Ratings are based on a 5 point scale and range from 2 to 5.
- LendEDU: A combination of outside ratings, financial strength, state availability, discounts, and basic coverage. Ratings are based on a 5 point scale and can range from 0 to 5.
|Company||AM Best||BBB||J.D. Power||LendEDU|
|AMICA MUTUAL||A+||A+||5 out of 5||4.68 out of 5|
|TRAVELERS||A++||A+||2 out of 5||4.55 out of 5|
|ALLSTATE||A+||A+||3 out of 5||4.47 out of 5|
|STATE FARM||A++||A+||4 out of 5||4.27 out of 5|
|SAFECO||A||A||2 out of 5||4.23 out of 5|
|LIBERTY MUTUAL||A||A||2 out of 5||4.23 out of 5|
|PROGRESSIVE||A+||B-||3 out of 5||4.20 out of 5|
|USAA||A++||Not rated||5 out of 5||Not rated|
Best company overall: Amica Mutual
Important categories such as policy offerings, billing processes, customer interaction, and claim experiences all scored a 5 out of 5. These are key pieces to any homeowners insurance policy, and Amica excels in all of them.
The only category where the company didn’t receive a 5 out of 5 was for price. Amica received a respectable 4 out of 5, but for those that are looking for a more affordable policy, this insurer may not be the top choice.
Best company for discounts: Allstate
While most companies offer discounts on policies, Allstate stands out because of the number it offers and the potential savings from those discounts.
With an Allstate homeowners insurance policy, you’ll have more than 10 ways to save. The featured discounts include up to 25% off when you bundle home and auto policies, up to 5% off when you set up automatic payments, and up to 20% off when you switch to Allstate without a recent claim.
Additional discounts include a protective device discount, early signing discount, welcome and loyalty discount, homebuyer discount, 55 and retired discount, and more. To learn more about these discounts, check out Allstate’s website.
Best company for those that are environmentally friendly: Travelers
Travelers offers benefits to homeowners who are environmentally conscious. The green home coverage, which is additional protection, can be added to an existing policy that will repair, replace, or rebuild your home with green materials after a covered loss occurs.
Additionally, Travelers offers a Green Home Discount that allows you to save up to 5% if your home is certified “green” by Leadership in Energy and Environmental Design (LEED).
Best company for military members and their families: USAA
USAA only offers policies to military members and their families, but the coverage is excellent for those who are eligible. The company was the only one to receive a 5 out of 5 in every category reviewed by J.D. Power in their annual home insurance study.
A homeowners insurance policy through USAA will cover you in the event of a fire, theft, vandalism, most weather-related events, liability, and identity theft. Your premium can be lowered by 10% if you bundle your homeowners insurance with auto insurance, and you can take off another 10% if you go claim-free for five or more years.
A unique perk the company offers is reimbursement for damaged or stolen uniforms from a covered event without a deductible being charged if you are on active duty or deployed.
How we determined the best homeowners insurance companies
To find the best homeowners insurance, our Editorial Team analyzed each provider on Trustpilot rating, Better Business Bureau rating, financial strength (including AM Best, Moody’s, and S&P), state availability, household discounts, policy discounts, basic coverage, and J.D. Power score.
All data points were averaged together evenly to determine an overall score. Learn more about our ratings and methodology here.
To determine which companies offered the best homeowners insurance in specific categories like the four listed above, a member of our Editorial Team analyzed the top rated companies and identified areas where that company stood out amongst the rest.
How to choose the best homeowners insurance
Finding the best homeowners insurance for your needs is an important life decision. A study conducted by the Insurance Research Council (IRC) found that from 1997 to 2018, the severity of claims increased by 373%.
For example, a claim in 1997 for $10,000 in damages could now total $47,300 in 2018 for the same claim. As you can see, choosing a home insurance policy that leaves you vulnerable to uncovered damages can lead to significant financial loss.
If you’ve compared the financial and customer satisfaction ratings of the best homeowners insurance companies above and still aren’t sure which is right for you, here are a couple things worth considering to help you choose the right policy.
The deductible is the amount you will need to pay before your policy goes into effect. For example, if your home sustains $20,000 in covered damages, and your deductible is $2,000, then your insurance provider will pay you $18,000 for damages and you’ll pay $2,000 out-of-pocket.
Note that, unlike health insurance, homeowners insurance deductibles are typically charged on a per-claim basis. This means that you will have to pay your deductible for each claim you submit.
The deductible you choose directly influences the premium you will pay on your policy. To lower your monthly premium, you can consider taking a higher deductible. However, you’ll want to ensure you can afford paying your deductible in the event that you need to submit a claim to your provider.
>> Read More: What is the Average Homeowners Insurance Deductible?
The base coverage for a home insurance policy may not cover all of your belongings or financial needs. That’s why it’s important to review the policy after receiving a quote to consider whether any add-on coverage is necessary.
For example, your policy may state that certain high-value items, such as jewelry or art, are subject to item-specific coverage limits unless you add on an additional rider.
Or your coverage may provide actual cash value (ACV) coverage rather than replacement value coverage, meaning that if you lose your home to a disaster, you could end up receiving less than than it would cost to buy or build a new home today.
When comparing companies, don’t just compare the base coverage costs if you plan on purchasing additional coverage. Always compare costs after you know how much additional coverage you’ll need.
Most homeowners insurance companies offer discounts to help lower the overall cost of your policy. However, not every company offers the same discounts. This is why it’s important to compare multiple options before committing to a provider. Some common discounts include:
- Home and auto bundle
- Security system
- Smoke detectors
- New home construction
As mentioned above, a common discount offered through homeowners insurance policies is a home and auto bundle discount. This discount can lead to meaningful savings. For example, Allstate offers a discount of up to 25% when you bundle home and auto insurance. Compare the bundle discount from multiple companies to see which would lower your overall cost the most.
What does homeowners insurance cover?
At the start, a homeowners insurance policy typically provides coverage for your dwelling (the structure of your home), other structures (detached structures on the property, such as a garage), personal property (personal belongings on the property), loss of use (living expenses while your home is being repaired), and personal liability (legal and medical bills for injury or damage to someone else).
What does homeowners insurance not cover?
The list below includes some common coverage options that most home insurance companies don’t offer in the initial policy but can be added at an additional cost:
- Extra contents
- Replacement cost
- Additional liability
- Flood insurance
- Earthquake insurance
Not all providers will offer the add-on coverage above. For example, if you are located in an area where floods or earthquakes are common, you may need to purchase a separate policy specifically for that purpose. Make sure to ask your insurance company what coverage it provides and whether that coverage is included in your base policy or needs to be added on.
Are you underinsured?
The first area where people tend not to have enough coverage is for their property. Sure, your home might be covered, but do you have full replacement cost or actual cash value coverage? If you have the latter, you might not be able to afford to rebuild your home if the replacement cost is more expensive than the current value of your home.
If you have items that are particularly expensive or are in certain categories like electronics or jewelry, your policy might not cover them without a special rider specifically insuring them. That’s why it’s important to make sure that you read your policy closely so you know what’s covered and where you might need extra coverage.
Another way you might not have enough coverage is when it comes to liability. Most homeowner plans come with around $100,000 in liability coverage by default. This will cover you in the event that someone is injured on your property. But consider the costs of severe injury with life-long repercussions. With just $100,000 in liability coverage, you may not have enough insurance to cover the expenses and loss of income the injured will face over their lifetime.
Ask the Expert
How can you tell if you are underinsured?
Everyone’s situation is different. If you own a detached home, your insurance provider can help you complete a “baseline” evaluation of the cost to rebuild your home. This estimate will provide a useful starting point. You can then increase your limit of coverage to reflect the cost of additional features that would need to be repaired or rebuilt in the event of a loss, like a windstorm or a house fire. Common features that need increased coverage include luxury bathrooms, designer kitchens, and special items like solar panels.
Another important concern is your personal belongings: things like furniture, electronics, clothing, etc. If you own your own house, some coverage may already be included. If you rent your home or live in an apartment or condo, this kind of property will form the basis of your policy. A good way to determine how much coverage you need is to complete a home inventory. You’ll be surprised to see how quickly your limit of coverage climbs when you consider how much it would cost to replace all of your belongings, “right now,” with new items of similar kind and quality.
Choosing a limit of liability coverage can be subjective, but try to think: if you wanted to sue someone exactly like yourself, how much would you sue them for? What is the value of your assets, which could be on the line if you lose the lawsuit? This should help you form a basis for choosing enough liability protection, and your home insurance provider should be able to provide additional advice.
- Average Cost of Flood Insurance
- Is Jewelry Insurance Worth It?
- Does Homeowners Insurance Cover Theft?