Factors an insurance company uses to determine the price of your policy

Some of the factors an insurance company uses to determine the price of your policy are:

• The square footage of the house and any additional structures.
• Building costs in your area
• Your home’s construction, materials, and features
• The amount of crime in your neighborhood
• The likelihood of damage from natural disasters, such as hurricanes and hail storms
• The proximity of your home to a fire hydrant (or other source of water) and to a fire station, whether your community has a professional or volunteer fire service, and other factors that can affect the time it takes to put out fires
• The condition of the plumbing, heating, and electrical system

If you rent your home or own a condo/co-op, your insurer will not consider the size of the dwelling or building costs. However, it will take into account factors that make damage to your possessions more likely, such as living in Tornado Alley or in hurricane prone areas.
The price you pay for your homeowner’s insurance can vary by hundreds of dollars, depending on the above data and the company. So shop around and get at least three price quotes. You can call companies directly or access information on the Internet. Your state insurance department may also provide comparisons of prices charged by major insurers.