Becoming a homeowner for the first time is undeniably exciting, but it comes with responsibilities. One of the biggest responsibilities is protecting your home against potential damages. Houses are a big investment, so having a comprehensive homeowner's insurance policy is essential.
As of 2019, there were 2,496 property and casualty insurance companies on the market, according to the Insurance Information Institute (III). And if you’re in the market for homeowners insurance, it can be difficult to determine which company is the best option for your needs and more importantly, your budget.
We did some research to identify the best homeowner's insurance companies in 2021. Keep reading to see which providers we recommend, and what factors you should consider when buying a homeowner’s insurance policy.
The best homeowners insurance companies in 2021
We evaluated these providers based on their average rates, customer service ratings, discounts, coverage options, financial strength, and online tools and resources. We also gave each carrier a superlative to help you decide which company might be the best match for your needs and preferences.
|Provider||Best For||J.D. Power Score||AM Best Rating|
|Geico||Best for cheap rates||N/A||A++|
|Amica||Best for customer service||853/1,000||A+|
|State Farm||Best for online tools||829/1,000||A++|
|Progressive||Best for discounts||797/1,000||A+|
|Farmers||Best for customizable coverage||814/1,000||A|
Geico: Best for cheap rates
Geico is our top recommendation for homeowners who are simply looking for the cheapest rate possible. Geico is known for offering affordable home insurance policies, but there’s a catch—you get what you pay for. With Geico, your policy will only include basic coverage, and there aren’t many options to add coverage if you want more protection.
Similarly, Geico only offers a handful of discounts, which isn’t a big deal, considering the policies are cheap to begin with. You can save money on your home insurance policy by installing a home security system, bundling a home and auto insurance policy, and having smoke detectors and fire extinguishers throughout your house.
In terms of customer service, however, Geico leaves something to be desired. Geico is not rated by J.D. Power for overall customer satisfaction or claims satisfaction, but its Better Business Bureau (BBB) ratings raise a red flag. Geico has an average rating of 1.15 out of 5 stars based on 470 customer reviews.
Amica: Best for customer service
Amica is the best home insurance company for homeowners who want great customer service. Amica is the second-highest rated insurance company in J.D. Power’s 2020 U.S. Home Insurance Study for overall customer satisfaction. Plus, it earned first place in J.D. Power’s 2020 U.S. Property Claims Satisfaction Study out of 19 providers.
Amica offers a handful of home insurance endorsements, including identity fraud coverage, home business coverage, personal property replacement cost coverage, and dwelling replacement cost coverage. Amica also offers lots of great discounts, as well as dividend policies, where you can get back up to 20% of your annual premium.
In addition to its high J.D. Power ratings, we also like the fact that Amica has excellent financial strength, with an A+ rating from AM Best. Insurance companies that are strong financially have enough capital to repay policyholders after a covered loss, regardless of the state of the economy or the number of premiums it writes per year.
State Farm: Best for online tools
If you’re a first-time home insurance buyer, we recommend checking out State Farm. The company is known for offering a variety of online tools, resources, and calculators, which can be beneficial if you’ve never bought home insurance before. You can learn how to create a home inventory, determine how much coverage to buy, find out how to protect your pets, and more.
State Farm’s home insurance policies are moderately priced, but the company offers discounts for bundling your policies, installing an impact-resistant roof, and having a home security system. If you need more coverage than what is included, you can purchase endorsements for things like earthquake damage, identity theft, sump pump backups, and home systems protection.
State Farm is rated above average for overall customer satisfaction in J.D. Power’s study, but the company is rated below average in terms of claims satisfaction. It also has a BBB rating of 1.38 out of 5 stars based on 215 customer reviews.
Progressive: Best for discounts
Most insurance companies offer a few home insurance discounts, but Progressive goes above and beyond with their savings opportunities. Homeowners can lower their premium by bundling their policies, installing a security system, paying their premium in full, buying a policy in advance, insuring a new home, and enrolling in paperless billing statements.
Another unique feature of Progressive is their contractor network. If your home gets damaged or destroyed by a covered peril, Progressive can recommend a qualified contractor, and depending on the work needed, you could get a better price. Plus, Progressive will handle payment with the contractor, which means less work on your end.
Based on third-party ratings, Progressive does not have the best customer service. The company received below-average ratings in J.D. Power’s overall customer satisfaction and claims satisfaction study. Plus, the company has an average BBB rating out 1.12 out of 5 stars based on 400 customer reviews.
Farmers: Best for customizable coverage
Farmers is our top recommendation for homeowners who want to be able to customize their home insurance policy with endorsements. The company offers three package tiers: Standard, Enhanced, and Premier. The Standard package is the cheapest, with basic coverage. Enhanced and Premier have higher coverage limits, plus extra features like roof replacement coverage and guaranteed replacement cost coverage.
Other perks that Farmers offers include a declining deductible, where you can lower your deductible by $50 for every claims-free year. Farmers also has a claim forgiveness program, where after five continuous claim-free years, your insurance rate won't increase after your next covered loss.
Farmers is rated above average for claims satisfaction by J.D. Power, ranking third on the list of 19 providers. But like the other insurance companies on our list, Farmers’ BBB rating isn’t great. The company earned a score of 1.5 out of 5 stars based on 118 customer reviews.
What to consider when looking for home insurance
Not all homeowners insurance companies are created equal. In fact, providers vary significantly in terms of the coverage offered, discounts available, average rates, etc. So when you’re shopping for homeowners insurance, there are several factors to keep in mind.
The type of coverage you need
The first thing to consider is what type of coverage you need. Some homeowners just need basic coverage, with the standard dwelling, personal property, liability, and loss of use coverage. But depending on where you live, you might need to purchase specialty coverages, like earthquake insurance, flood insurance, or valuables coverage.
Before you purchase a home insurance policy, take some time to think about what coverages you really need. If you live along the coastline, you should strongly consider flood insurance. If your home is located near a fault line, earthquake insurance is going to be beneficial. And if you keep valuables in your home, like art or fine jewelry, definitely consider scheduled personal property coverage.
Most homeowners insurance companies offer home insurance bundles, where you can get a discount on your premium by purchasing two or more policies from the same provider. The most common home insurance bundle is a homeowners insurance and auto insurance bundle, although most providers offer bundles with renters, condo, and even life insurance. If you need to purchase another policy besides home insurance, look for insurance companies that offer policy bundling discounts.
How much coverage you need
Another thing to consider when buying homeowners insurance is how much coverage you need. Insurance companies recommend that you have enough dwelling insurance to cover the cost of rebuilding your home, and enough personal property insurance to cover the cost of replacing your and your family’s belongings.
However, the standard amount of coverage may not be suitable for every homeowner. For example, if your home is valued at $200,000, you’ll need less dwelling insurance than someone who’s home is worth $600,000. When you’re looking at insurance providers, find out how much coverage is available. Depending on your home’s replacement cost value, you might need to look into providers that specialize in insuring high-value homes.
The last major factor to consider when buying homeowners insurance is your budget. Homeowners insurance rates vary, and every homeowner pays a different rate for coverage. Insurance companies use factors like your state, ZIP code, age, credit score, claims history, the size of your home, and the value of your home to price your policy.
The cheapest provider for your neighbor might not be the cheapest provider for you. As you're shopping for home insurance, comparing quotes can help you find the lowest rate for the type and amount of coverage you need. Most insurance companies have an online quote tool that allows you to get an instant rate estimate by providing information about you and your home.
Homeowners insurance is not legally required unless you have a mortgage, but having this type of coverage is extremely valuable. Home insurance protects the physical structure of your home and your personal belongings from common risks, and it also protects your liabilities.
Finding the best homeowners insurance company is a multi-step process. Before you choose a provider, it’s important to consider the factors that are most important to you, like price and the amount of coverage you need. Once you find a few contenders, comparing quotes can help you find the most affordable policy.