A Guide for How to Switch Home Insurance Companies

Switching home insurance providers is entirely possible for any homeowner, whether it’s to get discounts, lower rates or change coverage amounts. Even if you’re simply dissatisfied with your current carrier, you don’t have to wait for your policy to expire before finding a new one.

Changing home insurance allows you to have better control over your coverage and maximize the benefits offered by another provider. To make the process easier, MoneyGeek outlined how to switch home insurance companies so you can avoid some common pitfalls and find a provider that meets your needs.

• How to Switch Home Insurance Companies
• Reasons for Changing Home Insurance Companies
• FAQ About Changing Homeowners Insurance Companies

You can change your home insurance at any time. However, be sure to follow some key steps to ensure you purchase adequate coverage, avoid lapses in coverage and don't end up paying for two policies at once.

MoneyGeek breaks down how to switch home insurance companies — even in the middle of your policy term.

Knowing the details of your policy, such as your limits or deductibles, can help you make an informed decision when changing your provider. It may take a bit of time and effort to comb through your policy, but skipping this step could result in you purchasing an insurance plan with unnecessary or missing coverage. Some key details to be aware of before you begin your search for a new provider are:

• Coverage limits
• Deductible
• Inclusions
• Exclusions
• Expiration date

If you have an ongoing mortgage loan, your lender may have requirements for insurance coverage that your new policy must meet, such as special coverage for earthquakes or floods.

Although the process of changing your homeowners insurance may appear straightforward, hasty decisions can lead to higher costs over time. Big savings or better offers can be tempting, but remember to weigh the potential long-term implications of such a change to ensure you don't end up with unexpected out-of-pocket expenses or even higher premiums. Here are some common reasons for considering a switch in home insurance, along with important considerations for each:

• Lowering your rates: Changes in your financial situation, such as an improved credit score, may qualify you for lower insurance premiums. Before switching, ask yourself if the lower rates come with the same level of coverage or if you're sacrificing important protections for a lower price.
• Taking advantage of discounts: Many insurance companies offer discounts for various reasons, such as installing security systems or bundling home and auto insurance. Consider switching if you can significantly lower your premiums through discounts not available with your current provider.
• Increasing your coverage: Understanding your the replacement value of your home and personal property gives you a better understanding of how much home insurance you need. You can use this information to ensure you’re getting the best possible deal for the coverage you need when shopping for homeowners insurance.
• Seeking better customer service: Experience with claims, customer support and overall satisfaction can vary widely between insurers. If you're dissatisfied with your current insurer's service, looking for a company with a reputation for excellent customer support and efficient claims processing might be worthwhile.
• Your current policy no longer fits your needs: Life changes such as remodeling your home, purchasing expensive personal items or even changes in local weather patterns can render your current coverage insufficient. In such cases, it might be time to find a policy that better matches your current situation.

View the table below to see MoneyGeek’s picks for the best home insurance companies for different buyer categories.

Although you can change homeowners insurance anytime, it's best to time the switch to your advantage. If you don't, you could have a gap in coverage if your current policy expires before you choose a new policy or end up paying for two plans simultaneously. If you have a mortgage, a gap in coverage could have serious consequences — namely, your home’s foreclosure.

Some companies offer a prorated refund for the unused portion of your annual premium if you cancel your policy early. Others may subject you to fees or penalties. It’s best to check your current provider’s policy before you end your coverage.

If you’ve already decided on a new carrier, take some time to evaluate if your new policy is worth the penalty you’ll pay for canceling.

You’ll need to get quotes from various home insurance providers to find the best new carrier for you. Before you can secure those, however, make sure you gather the necessary information. Companies typically need information about you, your home and your household to give you an accurate quote.

Not all insurance companies will require all this information, but it’s better to have it ready if you need it.

Once you have your information ready, it’s time to compare quotes for homeowners insurance. No matter how attractive the rates may be, don’t settle for the first carrier you find — getting home insurance quotes from three or four companies is ideal.

To save time, you can shop online and use an online comparison tool. Comparison tools allow you to look at sample rates from multiple insurers simultaneously.

Look at the table below to see how the average cost of home insurance changes by company and coverage level.

When evaluating insurance companies, consider these key factors:

• Customer Service Reputation: Look into the insurance company’s customer service record, including their responsiveness, claim handling efficiency and overall customer satisfaction ratings.
• Financial Stability: Choose a company with strong financial health to ensure they can pay out claims, even in disaster situations.
• Coverage Options: Assess the variety and flexibility of coverage options available. Ensure the insurer offers policies that can be tailored to your specific needs.
• Claims Process: Investigate the insurer's claims process for its efficiency and fairness. A straightforward and quick claims process can significantly reduce stress in times of loss.
• Discounts Available: Consider what types of discounts are offered by the insurer, such as for home security systems, bundling policies or being claims-free, which can lower your premiums.
• Policy Exclusions: Be aware of what is not covered under the policy. Understanding exclusions will help you avoid unexpected surprises when filing a claim.
• Renewal Terms and Conditions: Look at how the insurance company handles policy renewals, including any changes in premiums or coverage conditions, to ensure long-term satisfaction.

When narrowing down your homeowners insurance options, it can be beneficial to consider aspects of coverage outside of rates. Depending on what you’re looking for, a policy’s billing plan, deductible and date of effectiveness may be factors to consider. Looking at homeowners insurance reviews can also be a great way to gain insight into what each company offers.

Before finalizing your new policy, keep the following in mind:

• Decide on included coverages. Do you need additional coverages besides dwelling and personal property coverage? These can be add-on coverages for specific perils, such as floods or earthquakes.
• Check on bundling possibilities. See if you can combine your home insurance policy with your auto insurance coverage. Bundling policies could save you hundreds of dollars every year.
• Pay for your new policy. Be sure to pay for your new policy before canceling your old one — this helps prevent a coverage gap since it can take several days for your new policy to go into effect.

Make sure you communicate your intent to terminate your policy with your present provider. If your policy auto-renews, you could pay for two plans simultaneously. You’ll also need to inform your provider when your cancellation takes effect. If they require you to do so in writing, ask for the physical address or email address you’ll need to send the document to, as well as the information you’ll need to include.

Typically, your mortgage requires your home insurance policy to be up to date. Call your lender and notify them that you’ve completed the process of changing home insurance companies. Be sure to send them documentation that includes:

• Your mortgage loan number
• The names and addresses of your present and new insurance company
• Your old and new policy numbers
• A payment receipt from your new insurance company
• A copy of your previous policy’s cancellation notice

Changing home insurance companies is within your rights as a homeowner. Switching providers can give you more control over your insurance, and you can do it any time.

Here are some of the most common reasons homeowners consider changing home insurance providers:

Homeowners often decide to change homeowners insurance companies because they want to get lower rates. Providers set premiums based on several factors that may change over time.

Certain events, such as filing a claim, can cause your current provider to increase rates. Some carriers also offer special discounts to homeowners who switch, serving as an incentive to change home insurance companies.

It’s best to reassess your coverage needs when your life circumstances change. If you are getting married, you may want to increase your limits to cover new valuables received. Having your home renovated may also cause your premium to change.

Remember that different insurance companies offer varying types of coverage. One example of this is protection against specific perils such as earthquakes or floods.

When your needs change, you may find another provider that offers a better deal.

Some people consider changing home insurance to purchase a new policy from the same company that provides coverage for their car to save money. Home and auto insurance bundles can score the average consumer 17% lower rates for their policies.

Additional discounts can also be a compelling reason to switch policy providers. Insurance companies all offer different discounts — knowing which are available to you from several providers can help you find more cost-effective coverage.

If you’ve filed a claim with your current homeowners insurance company and had a negative experience, you might want to look for a different provider.

Filing a claim is typically stressful as it usually comes after your home or belongings incur significant damage. A good insurance company doesn’t just offer low rates; it also helps you avoid additional stress by processing claims efficiently. Homeowners may switch to a company with better customer satisfaction results and financial stability to make the claims process more manageable.

Homeowners considering changing home insurance companies often have many questions about the process. MoneyGeek answered some of these to help make switching providers easier.