Question
What is the name of your state? Texas
Hello, my name is Glenn Kawesch. I was curious if anyone knew how often you should seek a competitive rates for your homeowners insurance and if this has an effect on your credit scores?
Glenn Kawesch
Answer
It may have an effect on your credit score if you search using an insurance agency vs through individual insurance companies. Some companies run credit for the quote, some not until the purchase. Shop as often as you feel up to repeating the same information over and over and over again to each company.
Answer
Your homeowner's insurance is usually paid annually. There's little benefit in changing before your anniversary date, because you will not get a dollar for dollar credit. For instance, if your annual payment is $500 and you have paid $500 and want to cancel after 6 months, you will not be guaranteed the entire $250. You're aware of fees, etc.
It's best to check and decide at least 6 weeks before your anniversary date because some insurers manage to get their money out of your escrow account before the anniversary date (if you have an escrow acct.)
If you find less than a $30 difference between the nationally known companies, then it may not be worth the time and effort of changing. Be sure to compare apples with apples. Coverage differences are easy to spot, however, things like getting a benefit for having an alarm, or a dog, or a fire hydrant nearby are internal decisions on how much to charge you. If the company that insures your auto also has your homeowners, you may get a little lower cost. If it's a lesser known company, there's no way of guaranteeing that a low rate today will still be a low rate for the next 2+ years. It could have been a teaser.....
Answer
You can get a prorated, dollar for dollar refund. With some companies it will not be. Ask.
Sometimes combining auto and home saves you money. Sometimes it doesn't. Ask.
If your current mortage company is already paid, and then you decide to cancel before the new policy starts, all you need to do is start the new policy, and ask them to bill your escrow. Notify your escrow to expect a bill. Cancel the current policy on the effective date. They will send the refund check directly to YOU. You will deposit that check, and write out another one to your escrow company.
Some lesser known companies have very good financial ratings. They are simply lesser known because they don't spend a lot of money on advertising. They actually may have been selling insurance for longer than your current carrier. I've had people ask me "I've never heard of that company. Are they are good company? Are they new?" They are surpised to hear that this particular company was the FIRST company to write auto/home/whatever insurance in the US, and they are still writing it today, and their rating is A+ (highest is A++) by AM Best.
Oh, and since rates are partially based on previous claims filed, rates can dramatically increase with ANY insurance company from year to year.
Do your research.