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Most Americans Don’t Fully Understand Their Homeowner’s Insurance Policy

While a home insurance policy is a must-have for any residential property owner, more than a few homeowners lack a proper understanding of what their policies cover.

According to a new published nationwide survey by Plymouth Rock Home Assurance that polled 1,000 homeowners, only 30% of respondents admitted they confident that they knew what their home insurance plan covered while 20% acknowledged they did not know what they were paying for home insurance. And while 68% of respondents compared carriers when they last purchased home insurance and 47% used a home insurance agent to purchase a policy, half of the respondents adopted a “set it and forget it” strategy and have not shopped for a new home insurance policy in the past three years.

As for the primary reasons for buying home insurance, 76% of respondents wanted to protect their property and belongings while 69% cited having peace of mind in being covered, 52% stated their mortgage lender required it and 35% were seeking personal liability protection in case of a lawsuit.

However, home insurance is not a universal aspect of homeownership: the study also highlighted a National Association of Insurance Commissioners study that found that only 85% of American-owned homes are insured.

Separately, the 2020 US Home Insurance Study recently published by J.D. Power found that more than two-thirds of home insurance clients were planning to renew policies with their current providers based on the quality of customer service experience they received. Slightly less than two-thirds of the 12,000 respondents listed reputation and convenience as the next major factors driving customer retention, while price was among the least chosen motivators.

As for the carriers, Country Financial topped the 2020 list of home insurance providers with a J.D. Power rating of 855 out of 1,000. Rounding out the top five were Amica Mutual (853), Auto-Owners Insurance (843), Erie Insurance (839) and The Hartford (832). Judging criteria were based on interaction, policy offerings, price, billing process and policy information, claims.

About Author: Phil Hall

Phil Hall is a former United Nations-based reporter for Fairchild Broadcast News, the author of nine books, the host of the award-winning SoundCloud podcast "The Online Movie Show," co-host of the award-winning WAPJ-FM talk show "Nutmeg Chatter" and a writer with credits in The New York Times, New York Daily News, Hartford Courant, Wired, The Hill's Congress Blog and Profit Confidential. His real estate finance writing has been published in the ABA Banking Journal, Secondary Marketing Executive, Servicing Management, MortgageOrb, Progress in Lending, National Mortgage Professional, Mortgage Professional America, Canadian Mortgage Professional, Mortgage Professional News, Mortgage Broker News and HousingWire.
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