When it comes to homeowners insurance, it’s easy for homeowners to shop once and renew every year without considering other options.
But in the right circumstances, shopping around for insurance more frequently can deliver better coverage or cost savings.
Here, we’ll show you five ways to get homeowners to shop around for new policies or coverage. With the right questions, you can deliver better value to potential customers.
1. Discuss Premium Increases
At renewal, many insurers increase their premiums without explanation – and homeowners get sticker shock.
Premium hikes happen from time to time, of course. But when homeowners don’t know why, they might start to wonder whether their policy still meets their needs.
When talking with homeowners, ask them whether their homeowners premiums have recently gone up. Explain that homeowners insurance premiums can change for a number of reasons, such as:…
- Rising natural disaster risk. Disaster-prone areas are more expensive to insure.
- Inflation. Inflation affects home repair costs, which insurers may factor into their premium pricing.
- The age of the insured’s home. Older homes may be at higher risk of damage.
Although homeowners can’t control many of these factors, there’s a silver lining: different carriers may calculate their premiums differently, which creates room for cost savings.
Make sure homeowners understand this detail. If homeowners know they can potentially save on premiums, you can help them shop around for policy alternatives. Premium hikes are often an unwelcome and unexpected hit to people’s wallets – and a nudge could be all they need to start looking for a more affordable policy (and becoming your customer).
2. Tie Inflation to Underinsurance
Consumers are feeling the costs of rising inflation – and not just at the grocery store.
Inflation is affecting the construction industry’s supply chain, increasing the price of key materials by as much as 127 percent from 2020 to 2021. These costs are ultimately passed on to consumers who need repairs or new construction.
With skyrocketing construction costs, homeowners may find their homes underinsured. If a covered event causes damage to an underinsured home, homeowners will likely have to shoulder the leftover costs of property repair, replacement, or reconstruction.
Underinsurance can be a frightening prospect for homeowners. To help ease their concerns, lead with education. Explain the reality: inflated construction costs could mean their home is underinsured. Then, use your digital tools to help them get a sense of current recommended coverage limits.
3. Talk about Increased Disaster Exposure
Climate change has intensified the effects of natural disasters nationwide. Over the last few years, Americans have noticed more intense wildfires, hurricanes, and flooding –leaving more homeowners than ever at risk.
Homeowners’ disaster exposure affects more than their insurance premiums. It can affect their coverage needs, too.
For example, homeowners insurance policies may omit wind coverage in hurricane-prone regions (19 in total, as of 2022). And homeowners insurance typically doesn’t cover damage from natural disasters such as flooding and wildfires.
You can help homeowners by educating them about changing disaster risk. Start with risk assessment tools like Flood Factor, which helps people assess their area’s flood risk.
Then, show homeowners how to start shopping for the right coverage or policy (which may require purchasing separate insurance to mitigate flood or wildfire risk). With your guidance, you can help homeowners cover at-risk property before a disaster strikes.
4. Ask about New High-Value Possessions
For homeowners with new valuables, adequate coverage may depend on the item’s type and value.
A standard policy might cover $2,000 in value per object, but only $5,000 total. That coverage limit will likely suffice for a new smartphone or laptop, but it may not be enough to cover expensive artwork. And specific high-value items – like jewelry or firearms – may receive little to no standard coverage. Instead, policyholders may need to purchase separate personal property coverage or jewelry protection insurance.
When talking to homeowners, ask them about any high-value possessions they’ve acquired since they applied for their homeowners policy, and make sure to explain these standard coverage limitations. Then, show them how expanded coverage limits or policy add-ons can help them cover high-value items.
During your conversation, remember to present policies from multiple carriers to ensure the homeowner gets the best possible value for their coverage.
5. Ask about Pets
New pets can be exciting additions to the family – but some come with additional risks.
For example, many insurers consider certain dog breeds more prone to biting humans. For this reason, insurers often list “restricted breeds.” These typically include pit bulls, German shepherds, chow chows, and more. If a homeowner has a restricted pet breed, they may find their pet difficult or impossible to insure under their existing policy.
If you’re talking to an affected homeowner, make sure to deliver the good news: breed coverage varies by carrier.
To maximize risk mitigation, encourage homeowners with restricted pet breeds to look for a new policy that can cover everything under their roof, new pet included.
Help Homeowners Manage Unexpected Expenses to Deliver More Value
Property damage or loss hurts when it’s unexpected, and hurts more when someone isn’t propertly prepared for it. When you encourage homeowners to start shopping around for insurance, you’re helping them manage unexpected costs before they happen. This demonstrates your value as an insurance agent – and could turn them into a customer for life.
To deliver the most value, take advantage of We Insure’sE’s expansive carrier access and additinal support services. With the right tools, you can provide your customers with as many options as possible to meet all their needs today. Interested in joining the We Insure family? Learn more about the power of “We” today.
The information contained in this page is provided for general informational purposes only and may not be applicable to all situations. We Insure makes no guarantees of results from the use of this information.
