Compare the inputs first, the coverage second, and the premium last. That order matters, because on an expensive home the premium gap between two quotes is almost always explained by something in the first two categories. The cheaper quote is often cheaper for a reason you wouldn’t have accepted if anybody had named it out loud. Run a price comparison on unmatched inputs and you haven’t compared anything.
Here’s the checklist, in the order we use it. Use it on our proposals too.
Why premium is the last thing to look at
A homeowners quote is the output of a long list of assumptions. How big the rebuild is, what the policy will pay, what you absorb before it pays, how long it pays for temporary housing, and which perils it addresses at all. Change one assumption and the number moves.
So when you put two quotes side by side and one is lower, there are two possibilities. Either you’re being offered the same coverage for less, which happens and is worth having. Or you’re being offered different coverage, and the gap isn’t savings. It’s risk handed back to you that nobody itemized.
The checklist below tells those two apart.
Step one: match the dwelling estimate
Nothing else can be compared until this is settled.
Ask of each quote: what produced the dwelling limit? An automated replacement cost estimator fed by public record data? A detailed estimate built from the actual property? An inspection or a construction appraisal? What quality grade got selected? What date was it run?
On a custom or older home this is where the biggest errors live, because automated estimators price a conventional house. See dwelling coverage versus market value and how much homeowners insurance do I need.
If two quotes carry different dwelling limits, stop. Get them onto the same reconstruction number and requote. Several other limits are expressed as percentages of the dwelling, so everything downstream is out of line until you do.
Step two: read the settlement basis
Three different things get called the same thing in proposals.
Replacement cost to the limit. The policy pays to rebuild up to the stated dwelling limit and no further.
Extended replacement cost. The policy pays above the limit, up to a stated additional amount or percentage. How big that extension is varies a lot.
Guaranteed replacement cost. Written to pay what it costs to rebuild. Many programs cap the amount, and several attach conditions, including that the limit was set to an approved estimate and kept current. The label on the summary page isn’t the endorsement.
Extended versus guaranteed replacement cost walks through the difference. Ask for the endorsement form number on each quote and read what it actually says.
Then check two settlement modifiers that have been spreading:
- Roof settlement schedules. Some forms settle a roof past a certain age on an actual cash value basis, meaning depreciated value rather than what a new roof costs. See roof coverage: replacement cost versus actual cash value.
- Cosmetic damage exclusions. Common on roofs and siding, especially for hail. See roof age and cosmetic damage exclusion.
Either one can explain a whole premium difference by itself.
Step three: check ordinance or law
A partial loss to an older or custom home often triggers code required upgrades to parts of the house that weren’t damaged, plus demolition and debris removal of undamaged structure. Ordinance or law coverage is what responds to that.
Compare the limit, usually expressed as a percentage of the dwelling, and whether it covers all three pieces: the increased cost of construction, demolition of the undamaged portion, and the lost value of the undamaged portion.
On a home built to an older code, this is one of the most consequential lines on the page and one of the least read. See ordinance or law coverage on a homeowners policy and the ordinance and law gap on a partial loss.
Step four: compare contents properly
Four things, not one.
- The overall personal property limit, and whether it’s a percentage of the dwelling or a stated blanket amount.
- The settlement basis. Replacement cost or actual cash value, and whether replacement cost on contents took an endorsement.
- The internal sub limits by category: jewelry and watches, furs, silverware, firearms, money, business property, and the separate and usually lower theft sub limits.
- The schedule. What’s listed, at what values, on what basis, and whether it’s agreed value, meaning a figure settled in advance rather than argued after a loss, and worldwide. See scheduling jewelry and valuables.
A quote with a big headline contents number and a small jewelry theft sub limit isn’t better than one with the reverse, if jewelry is your exposure.
Step five: read loss of use as a number and a clock
Loss of use pays the extra cost of living somewhere else while the home is unlivable. Compare:
- How it’s expressed: a percentage of the dwelling, a stated dollar amount, or unlimited
- Whether there’s a time cap, and how long
- Whether it contemplates comparable housing or the cheapest adequate alternative
- How it holds up against a long rebuild, which custom and older homes routinely have, and which whole regions have after a widespread catastrophe
The failure here is arithmetic rather than dramatic. The money or the clock runs out before the house is finished. Loss of use coverage on a homeowners policy covers it.
Step six: line up every deductible, not just the first one
Build a small table for each quote:
| Deductible | Quote A | Quote B |
|---|---|---|
| All peril | ||
| Wind or hail | ||
| Wildfire, where it applies separately | ||
| Water or water backup, where separate | ||
| Earthquake, on the separate earthquake policy | ||
| Flood, on the separate flood policy |
Two things people miss. Percentage deductibles get calculated against the dwelling limit, so on a large limit they can come out well above the flat all peril number. And a separate catastrophe deductible can be on one quote and missing from the other, which by itself can account for most of a price difference.
Home insurance deductibles explained and earthquake insurance deductibles explained cover the mechanics.
Step seven: compare catastrophe terms as a set
In our region, four perils need explicit confirmation on every quote.
Wildfire. Is it covered as part of fire, is there a separate deductible, is there a mitigation requirement, and can the company reassess after an inspection? See wildfire home insurance.
Earthquake. Excluded on essentially every homeowners form. If you want it, that’s a separate policy or endorsement with its own limit and percentage deductible. Check whether each quote includes one at all. See earthquake insurance in Oregon and Washington.
Flood. Excluded and separate. Confirm whether either proposal includes it.
Water that isn’t flood. Sewer and drain backup, sump failure and hidden seepage are distinct coverages with their own sub limits. See water backup coverage on a homeowners policy and hidden water damage, seepage and mold coverage.
A quote that’s silent on one of these isn’t offering it.
Step eight: liability and where the umbrella attaches
Compare the homeowners liability limit, then go straight to the excess.
An umbrella sits over the underlying policies it was written to sit over, and only those. Ask for the underlying schedule in writing and confirm it includes:
- Every vehicle in the household, including any titled to a trust or an entity
- Every residence, including seasonal, secondary and out of state properties
- Watercraft and recreational vehicles
- Any rental activity, including short term
- Household employees, if you have any. See domestic employee insurance
Then check what the umbrella adds beyond limit: excess uninsured and underinsured motorist coverage, personal injury coverage, and how defense is handled. See how much umbrella insurance do you need and how to choose your liability limits. Nobody needs to state a net worth to do any of this.
Step nine: find the conditions that haven’t happened yet
Almost everyone skips this step, and it’s the one that turns a good quote into a bad year.
Ask of each quote:
- Does this depend on an inspection that hasn’t happened?
- What does the inspection look at, and what’s the timeline?
- If it produces required repairs, what’s the deadline and what happens if they aren’t done?
- Can the company change the dwelling limit, add a condition, or walk away after the inspection?
- Are any conditions still open, like proof of prior coverage, an appraisal, a mitigation certification, or a set of photos?
A quote with conditions still open is a proposal, not a price. See high value home inspection.
Step ten: now look at the premium
At this point the number means something. Compare it with the package in view, since credits for putting the home, autos, valuables and umbrella together change the arithmetic. A standalone home quote against a package quote isn’t a fair fight.
One more question before you move anything. What would it cost to fix the policy you already have? Correcting the dwelling limit, raising ordinance or law, scheduling the items and setting the umbrella properly closes most of the common gaps without changing companies at all. Questions before switching home insurance covers the rest of that decision.
Where to go from here
This checklist belongs to our high value home review page, which is the service that runs it on your actual documents. If you’re earlier in the process, standard versus high value home insurance explains what the two kinds of program do differently, and how much does it cost to insure a million dollar home explains what drives the number.
Rather hand us the quotes than work the list yourself? Request a coverage review and we’ll mark up whatever you have, including a proposal from another agency.