Lemonade Insurance: Best Online Insurance Company

The only downside to Lemonade is that its insurance policies are not available in all states.

Lemonade COVID-19 Response

Lemonade allows customers who are experiencing financial difficulties to postpone premium payments for up to 60 days without losing coverage. They have also increased the grace period for customers who have already fallen behind on their payments to 60 days.

Erie Insurance: Best Range of Coverage Options

Erie Insurance offers discounts to customers who install automatic sprinklers, smoke detectors, and burglar alarms.

Erie Insurance COVID-19 Response

Erie Insurance is being more accommodating with payment deadlines and may waive some penalties and fees. By logging into your account, you can request deferred payments. Visit their blog for more information.

Allstate: Best for Claim-Free Homeowners

Allstate offers a program called HostAdvantage, which provides personal property coverage to protect against theft and damage by home-sharing guests or renters as part of its wide range of insurance products.

Allstate COVID-19 Response

Allstate encourages policyholders to use the company's mobile app to access policy information, file a claim, provide proof of insurance, or request 24-hour roadside assistance.

Amica Mutual: Best for Customer Service

Customers who have been with Amica for at least two years, as well as those who have been claim-free for at least three years, are eligible for pricing discounts.

Amica COVID-19 Response

Amica is assisting customers in establishing repayment plans and maintaining their coverage. For more information, see their FAQ.

USAA: Best for Military Personnel and their Families

One of USAA's few drawbacks is that it is only available to military members and their families. However, if you qualify for USAA membership, it will be difficult to find better home insurance for property damage.

USAA COVID-19 Response

Except in states where non-payment cancellations are prohibited, policy cancellations for non-payment have resumed. However, the insurance company provides financial assistance to qualifying members who have been economically impacted by the pandemic.

Other Home Insurance Companies We Considered

When we compared home insurance companies, we looked for financial stability, high customer satisfaction ratings, and a wide range of coverage options.

The insurance companies we chose excelled in all of these categories, but that doesn't mean there aren't other home insurance companies that can provide you with the right coverage, price, and customer service.

Home insurance plans from Hippo, State Farm, Farmers Insurance, Liberty Mutual, and Travelers Group are available to meet your needs, budget, and standards.

What Is Homeowners Insurance?

Homeowners insurance is a type of property insurance that protects a private residence from financial loss due to disasters, theft, and accidents.

Homeowners insurance policies come in a variety of forms. The most common policy is the HO-3 policy, also known as a "special form" policy, which covers the dwelling itself, your personal property within it, and personal liability.

What ISN’T Covered by Homeowners Insurance

When it comes to dwelling coverage, it's easier to discuss what isn't covered. In general, most policies will not cover structural losses caused by the following perils:

• High-risk flood areas: If FEMA determines that you live in a flood-prone area, you will be required to purchase a flood insurance add-on. The National Flood Insurance Program (NFIP) offers flood insurance to property owners, renters, and businesses in any of the 23,000 NFIP communities. Visit FloodSmart.gov for more information on what is covered.
• Hail and wind: Additional weather-related exclusions may apply depending on where you live. In Texas, for example, homeowners insurance policies for coastal homes do not cover wind or hail damage. To do so, you must join the Texas Windstorm Insurance Association and sign up for wind and hail coverage (TWIA).
• Dangerous dog breeds: Many insurance companies limit losses and liability claims resulting from certain dog breeds.

How to Determine Your Homeowners Insurance Coverage Limits

Coverage limits are typically determined by a choice between “actual cash value” and “replacement cost” coverages.

• Actual cash value calculates the value of your home minus depreciation, while accounting for any existing damage or wear. If your home is destroyed under this option, you will only receive a settlement for the value of your home at the time it was lost.
• The home replacement cost reflects the amount required to rebuild your home so that it is as similar to how it was before as possible. Because home replacement costs are almost always greater than the actual cash value, it is the most expensive coverage option.

To get the most out of your policy, make a detailed inventory of all your personal property and its value before coverage begins and submit it to the insurance company to ensure it is all covered.

For homeowners in climate-risky areas, obtaining insurance through a Fair Access to Insurance Requirements (FAIR) plan is frequently the only option. While these provide insurance for high-risk properties, these "last-resort insurance policies" can be costly.

Most Common Homeowners Insurance Discounts

Each insurance company will have its own options for helping you in lowering your insurance costs, but the following are the most common:

• Bundling your home and life insurance policies with the same company
• Living near a fire station
• Having a house that is less than 10-50 years old
• Signing up for an insurance policy within a year of purchasing your home
• Renewing your insurance policy before it expires

How We Chose the Best Homeowners Insurance Companies

Our list of the best homeowners' insurance companies simplifies the shopping process. To develop a methodology, we combed through dozens of insurers and coverage options, narrowing our choices to the best ones based on a number of criteria.

We began our investigation by looking at how insurance companies fared in JD Power's 2020 U.S. Property Claims Satisfaction Study, which measures customer satisfaction with processes such as claim settlement, claim servicing, First Notice of Loss (FNOL), estimation, and repair.

To narrow the field even further, we looked at each underwriter's complaint ratio for homeowners insurance, which is based on data from the National Association of Insurance Commissioners (NAIC). Following that, we eliminated companies with A.M. Best financial strength ratings of less than A+.