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Credible Operations, Inc. NMLS # 1681276, is referred to here as “Credible.”
Whether you’re a newer homeowner or have lived in your home for years, your homeowners insurance policy may no longer fit your needs. If this is the case, know that you can switch your policy. Doing so might allow you to lower your premium or lock in a bundling discount. It also gives you the opportunity to increase or decrease your coverage amounts.
Here’s what you need to know if you decide to change homeowners insurance:
How to change homeowners insurance
To change homeowners insurance, follow these steps:
1. Understand your current policy
First, take a close look at your current homeowners insurance policy. Make sure you know your annual premium, coverage amounts, deductible, and effective dates. You can find all these details on the policy declarations page, which is the first page of your policy.
If you don’t have your declarations page available, reach out to your insurance company and ask for a copy. You might also be able to access it via your online account.
2. Determine your coverage needs
When changing home insurance policies, reassess the amount of coverage you need. Perhaps you’re paying for too much coverage, or you recently updated your home with new safety and security features. Now’s the time to make any necessary adjustments to your coverage so that you can avoid overpaying.
3. Compare different home insurance companies
Not all home insurance companies are created equal. That’s why it’s a good idea to shop around and explore your options. You can reach out to different providers directly to learn more about their offerings. Or, use Credible (powered by Young Alfred) to get home insurance quotes from multiple providers in one place.
The Credible marketplace, which includes insurance services by Young Alfred, makes it easy to find a carrier and policy that’s right for you.
Compare policy limits, exclusions, deductibles, and discounts. Don’t forget to read rankings and reviews as they’ll help you learn about each company’s reputation and customer service so you can make an informed decision.
4. Make the switch
Once you find the ideal policy, reach out to the new insurer online or over the phone and let them know you’re ready to make the switch. Be sure to have some basic information about your old policy and your home.
Also, ask about any discounts or offers that may apply to you. Most importantly, to avoid a lapse in coverage and ensure your home is always protected, make sure the new policy starts where your current policy ends.
Tip: If there are no insurance companies willing to offer you coverage, contact your state insurance department to see if your state has a Fair Access to Insurance Requirements (FAIR) Plan or a similar program available. FAIR Plans help provide basic home insurance to homeowners unable to qualify for it in the standard insurance marketplace.
5. Cancel your old policy
Contact your existing home insurance carrier and cancel your policy. You’ll most likely need to call an agent to cancel your policy. Depending on the company, you may have to make your request in writing as well.
If your insurer accepts a cancellation over the phone, ask for an email or letter to confirm the cancellation so that your policy won’t be renewed automatically.
Tip: Ask about any cancellation fees or penalties that might apply to you so you’re not hit with a surprise charge.
6. Inform your mortgage company
If you have a mortgage, let your mortgage lender know that you’ve changed homeowners insurance companies. They might ask you to send them a copy of your new declarations page as proof. This will inform them of your policy number and how much you’re paying each year. Of course, if you own your home free and clear, you don’t have to notify anyone of the switch.
How to change homeowners insurance with escrow
An escrow account is set up by your mortgage lender. The money you put into it covers various home-related expenses, including your home insurance, property taxes, and private mortgage insurance (PMI).
If you have an escrow account, make sure your mortgage lender knows about your homeowners insurance change as soon as possible. You can expect them to send you a refund check for any unused premiums.
The lender might also allow you to put the refunded premiums back into your escrow account to be used for other purposes. Regardless, confirm the lender will send any future payments from the escrow account to your new insurance company.
Can you change homeowners insurance at any time?
Fortunately, you can change your home insurance policy whenever you want. However, that doesn’t mean you should. If you have to pay a cancellation fee or other penalty before your term is up, for example, you might want to wait.
Before you move forward with a switch, you’ll also want to make sure you understand your current lender’s terms and conditions for canceling your homeowners policy early. Calculate how much you’d save if you change and decide whether it makes more sense to switch when your term is up.
Tip: If you’re in the process of making a claim, consider putting off the switch a bit longer. It may be more difficult to work with claims adjusters and repair technicians if you’re trying to cancel your policy at the same time. The hassle of coordinating with two insurance companies might not be worth the money you’d save over a few weeks.
How often should you change homeowners insurance?
There’s no hard and fast rule for how often you should switch homeowners insurance. But it’s in your best interest to review your policy every year and shop around and explore your options. Otherwise, you might miss out on a better deal with a different company.
Even if your premium hasn’t shot up, it might make sense to re-evaluate your policy. Your insurance company may make changes to your coverage or you might not have enough coverage based on your home’s value.
Why do people switch homeowners insurance companies?
You may want to change your homeowners insurance company for a number of reasons, including:
- Life changes: If you’ve moved, got married, had a baby, or went through a divorce, your needs have likely changed. A different insurance company might offer coverage that better fits your current needs.
- Home improvements: You may want to switch homeowners insurance providers if your home’s value increased. For example, perhaps you installed a stronger roof or added a security system.
- A high premium: You don’t have to settle for a higher premium from your insurance company. If you’ve received notice that your rates are going to increase, don’t hesitate to shop around and look for more affordable home insurance elsewhere.
- Bundle discounts: Many insurance companies offer great discounts to those who bundle their homeowners insurance with another policy, like auto insurance. If you purchase two policies from one provider, you can save big.
- New valuables: To protect any expensive jewelry, artwork, technology, or other valuable items you’ve acquired since you took out your current policy, you may need additional coverage. This might be reason enough to change home insurance companies.
- Poor customer service: If your current homeowners insurance company doesn’t respond to your questions or inquiries promptly or delays the claims process, you can switch to a provider with better customer service.
Is it bad to switch homeowners insurance?
It’s not a bad idea to switch homeowner insurance, as long as you do so under the right circumstances. If you change to a different provider, you might secure a better rate, accommodate new coverage needs, take advantage of discounts, or enjoy better customer service.
In the event you want to switch homeowners insurance before your existing term comes to an end, make sure the cancellation fee doesn’t cost you more than the money you’d save. Also, if you’re in the middle of a claim, you might want to wait or you’ll have to deal with the hassle of communicating with two insurance companies at once.
Disclaimer: All insurance-related services are offered through Young Alfred.
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