What do homeowners insurance companies typically look at to quote a policy?

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Asked September 24, 2012

1 Answer


A common misconception with home insurance is that the cost of premiums is based entirely on the value of the home. The fact is that the insurance company looks at a lot of different factors. In addition to your credit score and other personal demographics, the specific information concerning the home will also be important.

Your credit score is how the insurance company determines the financial risk of insuring you. People with a credit score of 650 or higher can expect to pay lower rates. Similarly, the insurance company will check your CLUE report, which is the insurance equivalent to your credit report, containing information about the frequency, value and type of insurance claims you have filed. Just like a low credit score will result in lower rates, having a CLUE report which contains little or no previous claims will keep your premiums down as well.

Your premiums will also be affected by things such as your marital status, age, and occupation. These factors are used as an indication of maturity and financial stability, and that means lower premiums. Also, having additional insurance policies with the same insurer will earn you a discount. For instance, insuring your home and car with the same company would mean lower premiums for both policies.

The home will be the single biggest factor in determining your premiums. The size and value of the home are the most important factor of all, but other factors include the materials the house is built from, the age of the home, and where the house is located. For example, if the home is built in a low-crime, gated neighborhood, you would pay much lower rates than if he home was in a zip code with a high crime rate.

There are a number of discounts you can use to earn even lower premiums. A monitored home security system will get you a large discount, but you can also make your home safer by installing burglar bars on the downstairs doors and windows, having deadbolts installed on your doors, or putting up a fence to limit access by unwanted visitors.

Answered September 24, 2012 by Anonymous

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