There are a few things you should keep in mind when looking for homeowners insurance in the state of Arizona:
How much to buy: Since the point of insurance is to transfer risk, you should buy enough to protect your assets in case of a major loss. To protect your home as much as possible, you should insure it for the right amount. Don't skimp on protecting your house, since it's a big investment. Your mortgage company may also have a list of insurance rules you must follow.
Coverages: Know the difference between All Risk coverage and Named Peril coverage. All risk is more general and will cover all risks, unless they are excluded by the policy. Named Perils, on the other hand, will only cover the dangers that are named (i.e., fire, lightening, windstorm). All risk might cost a little more, but it's worth it to protect your home.
Valuation: Replacement cost coverage pays the amount it will take to replace your home with one of the same kind and/or quality. This is to protect our investment. The purchase price of your home goes down as its actual cash value goes up. ACV premiums may be less expensive, but replacement cost will bring the value of your home back to what it was before the loss.
Rates: Rates are based on things like:
Type of construction: Usually, it costs more to insure a house made of wood than a house made of brick.
- Age of the house: Discounts may be available for newer homes that may not be available for older homes.
How far is your house from a fire hydrant or a fire station? When setting rates, the availability of water in case of a fire is also taken into account.
- Deductible: The more you can pay toward your deductible, the more you'll save on your premium.
You can contact the Arizona Department of Insurance if you want more information or have a complaint.
Division of Consumer Affairs
2910 N. 44th Street
Suite 210
Phoenix, Arizona 85018-7256
