The Best Homeowners Insurance Companies of April 2023

How do you think climate change will impact homeowners insurance?

With droughts, fires, floods, and sea-levels on the rise, so too will insurance premiums. Insurance firms continue to assess the risk profile of consumers, the economy, and the environment in relation to the products they offer. With inevitable increases in homeowners insurance premiums, consumers may be forced to pay higher prices for plans that actually provide less in terms of coverage. Worse still, consumers may even be dropped by their insurer. Remembering that insurance is state-regulated (for example, the Federal Insurance Office or the Dodd-Frank Wall Street Reform and Consumer Protection Act), if consumers experience such challenging circumstances, they can contact their state’s department of insurance to find out if their insurance provider is breaking the law.

What can homeowners concerned with weather threats do to make sure they’re covered?

If buying a house, always consider the location and check if it is part of a fire, flood, or extreme weather zone. If you already own a home in a high-risk area, look for ways to reduce your risk and expenses. For example, look for opportunities to weatherproof your future or existing home. Moreover, when selecting an appropriate insurance policy, look for an insurer that gives pricing discounts for adding weatherproofing. Lastly, many financial factors determine the price of insurance policies, so it's important to build and maintain a good credit score.

What should homeowners do if their policy is canceled as the result of a weather emergency?

Don’t give up! Contact the insurance provider and seek advice on what you might be able to change for them to insure you again. If that fails, shop around as there are many mainstream and independent insurers offering different types of policies at a range of different prices. Additionally, talk to family and friends and ask which insurer they use, as those firms already have a precedence of insuring houses in your particular location. Lastly, if you can’t get an insurance firm to provide you cover, reach out to your state department. They may be able to offer a Fair Access to Insurance Requirements (FAIR) Plan. But remember, these types of plans only cover the bare-minimum.

How do you think climate change will impact homeowners insurance?

We have already noticed a lot of weather reactions resulting from climate change. These weather changes come in the form of more tornadoes, flooding, and fires, among many others.

There are at least two ways that climate change will affect homeowners insurance:

1. A potential increase in your homeowners insurance rate. Once your annual contract is up, the renewal of that contract may showcase a rate increase. In such cases, you can do two things:

• Negotiate with the company to reduce the rate
• Shop around and check the quotes from other home insurance companies

1. Specific damages are not covered. For example, you stay in an area which is not flood prone. Due to climate change, there was flooding in your area and your home did face some damage. Because your area was not under the flood zone, your company never covered it -- and you end up paying for it. So it's best for you to check the coverage policy and ask for some additional coverage, if that gives you peace of mind.

What can homeowners concerned with weather threats do to make sure they’re covered?

Customers can always ask for additional coverage. For example, your home insurance company may suggest that you don’t need the flood coverage, as you are not in a flood prone area. In that scenario, you can ask them to cover you, for an additional cost, if you think that climate change could make your area flood prone. Depending on where you live and your insurance company, things that are usually not covered include:

• Earthquakes
• Water damage
• Ice quakes and ice surges

Moreover, read the renewal of policies very closely. Ask a lot of questions and negotiate where needed. Clarify the coverage terms with your agent, and ask for additional coverage if you think your area will soon be newly prone to things like flooding or earthquakes.

Finally, look for other companies that have better rates. It's always safe to enquire and shop around with at least three more companies to see what they offer and how it compares with your current policy. If they are providing better coverage, changing your insurance may be the right move.

What should homeowners do if their policy is canceled as the result of a weather emergency?

• Check the federal and state laws to see if your insurance company is allowed to cancel it and under what circumstances. You can always challenge that decision, if there are certain laws that the company needs to abide by, before canceling it.
• Reach out to your homeowners association, neighbors, or anyone from your community. See if they are facing similar issues or if they are aware of any better insurance company options.
• Call multiple insurance companies yourself to get a quote and understand their policies towards these changes.
• Negotiations work. It can help to call the company’s customer service to check on what you can do to get it covered.
• Check the Fair Access to Insurance Requirements (FAIR) plan.

How do you think climate change will impact homeowners insurance?

With the increasing impact of climate change, U.S. homeowners have already started to see multi-faceted changes to their home insurance. For example, more extreme weather is causing insurance premiums to rise. But in places that are more vulnerable to extreme weather, residents have more extensive insurance options.

However, weather emergencies started to visit unexpected places where insuring your properties used to seem unnecessary. In those areas with an extremely high risk of climate disaster, insurers have canceled home insurance policies to protect themselves, leaving local residents unprotected. In recent years, climate change has become more like a systematic risk factor, significantly affecting the rate and availability of homeowners insurance.

What can homeowners concerned with weather threats do to make sure they’re covered?

Knowing what to expect from weather threats and when to expect them is a good starting point. As a homeowner, you need to know every detail of your policy -- since your insurance coverage can depend entirely on the policy you choose and what coverage is available in your state. For instance, many people with homeowners insurance are not aware that flood damage is not included in their coverage. Make sure you add any weather-related risk to your coverage from the start and plan ahead. Many companies will not allow you to add additional coverage within 30 days of a predicted weather event.

What should homeowners do if their policy is canceled as the result of a weather emergency?

If your policy is canceled due to a weather emergency, your first step is to call your agent or carrier to find out why it is being terminated and see if you can convince them to keep your coverage. In some cases, you may be able to make changes to your home or policy, such as repairing a damaged roof, which will satisfy the insurance company. If you're not able to convince your agent, or you're having trouble finding another affordable home insurance, check with your state’s department of insurance. They may provide a list of carriers who are capable of providing coverage in your area. Do it as soon as you can, because your lender may purchase a new home insurance policy on your behalf and expect you to pay for it.

How do you think climate change will impact homeowners insurance?

U.S. insurance firms have already begun to assess the potential financial impact of climate risk exposure. Looking at this trend from a positive viewpoint, homeowners in areas of the country with a higher probability of loss from climate change should be protected from significant loss through their homeowners insurance. However, this added protection will likely come with higher premiums and with additional language in homeowners policies regarding climate risks and what is not covered by insurance.

What can homeowners concerned with weather threats do to make sure they’re covered?

As with all financial services we purchase, it benefits the consumer to establish relationships with their brokers and agents at banks, insurance companies, real estate firms, and more. The better communication you can build with your financial institutions, the more likely you will be fully informed on the financial services you have purchased. It also helps you get your questions answered quickly.

What should homeowners do if their policy is canceled as the result of a weather emergency?

It is difficult for a homeowner to have risk management options if their policy is already canceled. This is why it is imperative to have people you regularly talk with at the insurance firm you use. Ask your agent/service representative about climate risk language in your homeowners policy. If you feel that your policy does not effectively manage your climate risk exposure, then shop for a new insurance company before there is an issue.

How do you think climate change will impact homeowners insurance?

The impact of climate change (increased flooding, sea level rise, hurricanes, and other natural disasters) will lead to increased homeowners insurance premiums in locations prone to these types of natural events. On the other hand, homeowners insurance premiums may decrease in locations that are not prone to these types of events.

Depending on the amounts of the increase, homeowners tolerance may be tested to an extreme, finally underlying a homeowner’s (or a commercial property owner’s) decision to vote with their feet and move to a location where insurance premiums and costs of living are lower.

To combat property owners' flight caused by increased insurance rates, the local, state, and federal government may consider capping and limiting the percentage insurance companies may raise insurance premiums per year.

What can homeowners concerned with weather threats do to make sure they’re covered?

Verify their policy. Read it. Make sure they have all the requirements for the area in which the property is located.

What should homeowners do if their policy is canceled as the result of a weather emergency?

Immediately contact their lender. It may be a mortgage default if the homeowners insurance is canceled.