How Insurers Determine Your Home Insurance Premium

Many factors affect the underwriting process, which determines the premiums you pay. Different insurance companies charge different premiums for similar coverage. Decisions you make about how much insurance coverage to buy also affect your premium. Some of the other things that are likely to affect your premium include:

• The cost to rebuild your home: this is not the same as the purchase price, which includes the cost of the land. Your insurance agent might help you estimate replacement cost using information about your home and its contents
• Whether your home is made of brick or wood: the premium is usually lower for homes that are primarily brick or masonry than for wood frame homes
• The proximity of your home to resources and services, such as a water source or fire department and the quality of your community’s fire protection services
• The age and condition of your home; the premium is often higher for older homes and homes in poor condition than for newer homes and homes in good condition
• The claims history of your neighborhood and community, particularly the homes immediately next to your address
• A wood furnace or wood stove in the home
• Owning high-risk outdoor amenities, such as a swimming pool, a trampoline or playground equipment that could cause injuries
• The types of pets you have. Some insurers won’t insure you if you own certain breeds of dogs that are known to be aggressive, such as, but not exclusive to:
  • Akitas
  • Alaskan malamutes
  • Presa Canarios
  • Chow chows
  • Doberman pinschers
  • German shepherds
  • Pit bull terriers
  • Rottweilers
  • Siberian huskies

Other companies do not exclude specific breeds, choosing instead to consider individual animals on a case-by-case basis. In some cases, the presence of exotic pets in the home, such as snakes, lizards, birds and horses, may also drive up rates.
We don't need a crystal ball. Our agency uses state of the art software to seek the best coverage at the lowest cost for your insurance needs. We welcome the chance to discuss them with you.