Why the Cheapest Home Insurance Quote Isn’t Always the Best

Why the Cheapest Home Insurance Quote Isn’t Always the Best

Maybe you’ve once tried and tried to get in touch with your insurance company in the past and they took a long time to respond? Think back to how much you were paying. Was it rather low compared to what else was on the market then?

Many times, in our search for cheap home insurance premiums, we forget that sometimes cheap is eventually expensive. Many things that are cheap will end up costing you in the end and this can happen with homeowner’s insurance too. If you’re wondering why cheap is sometimes not so good for insurance, here are some reasons:

1. How cheap is cheap really? They could be offering you a policy that looks cheap in premiums, but they never offer you anything in the way of benefits or discounts. It pays to see how much your benefits translate to in monetary terms because this will help you make good comparisons. You may find that a company that’s asking from slightly more in premiums ends up being the one that is actually really quite cheap because of the discounts and benefits they include in their package.

2. A lot of times, when you pay little for a service, you get very little service in return. Insurance is a service very much like the one provided by doctors – you never need it until things go wrong. When they do, you want attention immediately. An insurance company that’s asking for very little in the way of premiums is very likely skimping somewhere. Since the biggest costs in a company are associated with payroll, it’s likely that they have cut down on the number of employees. This is likely to leave a small number who are overworked and demoralized. They will respond slowly to any services required of them. Also, be careful when choosing those that are not located near you – getting a representative to come out and see you may take them a long time.

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3. You should always look at their litigious history. Some of the very cheapest are like that because they will hardly award claims. They attract lots of good-intentioned policy holders and hope that misfortune never occurs. They are basically rip-off schemes because they will find all ways to avoid settling a claim. They may take forever to do investigations, keep asking for irrelevant information and generally make the process really tedious. This can be very painful for you, especially if you had a major disaster in your home and you need to rebuild and move on. Some of the best insurance companies will tell you that they don’t have a litigation department because they don’t need one – they act to compensate as soon as things go wrong and they are swift, although they may be a bit more expensive.

For these 3 reasons alone, you should always make sure that you check any homeowner’s insurance quote to see exactly what is being offered. There are some good cheap ones out there no doubt, but at the same time, it’s very easy to find yourself holding a policy that’s nothing but a headache.