Exploring the Reason for Differences in the Average Cost of Home Owners Insurance
Are you a homeowner looking to get a quote on home owners insurance? If you are, chances are you’ve tried to get several different quotes from various insurance companies. If you’ve gotten several different quotes, then you’ve probably noticed that the average cost of home owners insurance varies dramatically from company to company.
This may lead you to ask ‘why is the average cost of home owners insurance’ different when neither the items nor value of the home changes. The following explores how and why low cost home insurance quotes can vary from company to company.
A number of different factors are taken into account when coming up with a quote for low cost home owner insurance. Insurance companies will take factors such as location of the home, value of the home, and contents inside the home into account when coming up with quotes for home insurance costs.
Many insurance companies use the same factors to determine a quote, but they don’t always appraise the value of specific items at the same price. This often leads to the differences you will see when you get quotes for the average cost of home owners insurance.
For example, one insurance company may appraise a painting at 5,000 dollars while another values it at 1,200 dollars. The difference in the appraisal price could lead to differences in the average cost of home owners insurance quote you receive.
Even though you will notice that the average home insurance cost will vary, chances are the quotes will usually be fairly close to each other. The reason for this is because most states have a Department of Insurance. The Department of Insurance is a regulatory government department that makes sure all insurance companies are using the same insurance rates to give quotes.
The regulation department is put into place in an effort to protect homeowners who are looking for insurance plans that are way below the average cost of home owners insurance. This regulation prevents companies from offering outlandishly low rates for plans that do not comply with state insurance regulations.