Price vs. Value
Protecting Your Home Without Cutting Corners
When it comes to your biggest investment, the cheapest option isn’t always the best. Learn why value matters in Florida home insurance.
Inexpensive Coverage Can Leave Pricey Gaps
It’s tempting to choose the lowest premium, but bargain policies can come with significant limitations. In Florida, where hurricanes, floods, and changing building codes can happen anytime, coverage gaps can be devastating on your wallet. It’s important to understand what is and isn’t covered before you decide solely based on price.
Common bargain policy exclusions:
- Flood Damage: Not covered without a separate flood insurance policy or endorsement.
- Ordinance & Law Coverage: Costs to rebuild your home up to codes that were established after your home was built are not covered by your policy, unless you purchase this coverage.
- Wind-Driven Rain: When forceful winds cause rain to enter your home, the associated damage may not be covered under standard homeowners insurance. This coverage can be purchased separately.
Compare Policy Options
Price is One Thing—Protection is Everything
Your home is more than a building—it’s where your life happens. Here’s why comprehensive coverage offers more value:
Your home is more than a building—it’s where your life happens. Here’s why comprehensive coverage offers more value:
- Peace of Mind: Knowing you’re covered for wind, flood, and other common Florida risks.
- Protection Against Financial Loss: Paying a couple extra hundred dollars up front could save you thousands on the back end.
- Precise Coverage: Work with your agent to address your specific circumstances to make sure you’re paying for the coverage you need, and not the coverage you don’t.
The Factors Behind Your Premium
Understanding how your premium is calculated can help you make smarter decisions. Key factors include:
- Location: Proximity to the coast or flood zones
- Home Characteristics: Age, materials, and compliance with building codes
- Coverages: Depending on what coverage you select to protect your home, each coverage/endorsement can impact your premium
- Deductibles: Choosing a higher deductible can lower your premium but increases out-of-pocket costs in a claim
- Discounts: Make sure you’re receiving all of the savings you qualify for! Home security features (like burglar alarms or being located in a gated community), wind-mitigation features, or being a senior or member of the military can earn money off your premium
Does Your Carrier Have the Financial Stability to Pay Claims?
If your insurance carrier lacks sufficient reinsurance or financial strength, it could struggle to pay claims, especially in widespread disasters like hurricanes. Here’s what to look for:
Strong Financial Ratings
- Check independent rating agencies like Demotech (in Florida), AM Best, and the Better Business Bureau for an objective viewpoint to ensure your carrier is financially sound.
Adequate Reinsurance
- A well-reinsured company can handle a multiple major storm season without financial strain.
Proven Stability
- Look for a carrier with a track record of paying claims, even in challenging times.
Protect What Matters Most
The least expensive policy isn’t always the best deal. A comprehensive policy might cost more upfront, but saves you from financial stress in the long run. Your home deserves better than bargain coverage—it deserves the right coverage.
Now that you’ve learned the key factors behind choosing the right coverage, don’t stop here! Keep reading to boost your insurance IQ and make informed decisions that protect your home and finances.