Compare the inputs first, the coverage second, and the premium last. That order matters because on high value homes the premium difference between two quotes is almost always explained by something in the first two categories, and the cheaper quote is frequently cheaper for a reason you would not have accepted if anyone had named it. A price comparison run on unmatched inputs is not a comparison at all.
What follows is 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 any one assumption and the number moves.
So when you put two quotes side by side and one is lower, there are only two possibilities. Either the same coverage is being offered for less, which happens and is worth having. Or different coverage is being offered, and the difference is not savings, it is a transfer of risk back to you that nobody itemized.
The checklist below exists to tell 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 was 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, do not proceed. Get them onto the same reconstruction number and re quote. Everything downstream, including several other limits that are expressed as percentages of the dwelling, is otherwise misaligned.
Step two: read the settlement basis
Three distinct 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. The size of that extension varies widely.
Guaranteed replacement cost. Written to pay the cost to rebuild. Many programs cap the amount, and several attach conditions, including requirements that the limit was set to an approved estimate and kept current. The label on the summary page is not the endorsement.
Extended versus guaranteed replacement cost walks 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 through the market:
- Roof settlement schedules. Some forms settle a roof past a certain age on an actual cash value basis or on a depreciation schedule. See roof coverage: replacement cost versus actual cash value.
- Cosmetic damage exclusions. Common on roofs and siding, particularly for hail. See roof age and cosmetic damage exclusion.
Either one can explain a premium difference entirely.
Step three: check ordinance or law
A partial loss to an older or custom home frequently triggers code required upgrades to portions that were not damaged, plus demolition and debris removal of undamaged structure. Ordinance or law coverage is what responds.
Compare the limit, usually expressed as a percentage of the dwelling, and whether it covers all three components: the increased cost of construction, the demolition of the undamaged portion, and the loss in 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 is 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 required 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 is listed, at what values, on what basis, and whether it is agreed value and worldwide. See scheduling jewelry and valuables.
A quote with a large headline contents number and a small jewelry theft sub limit is not 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 additional cost of living elsewhere while the home is unlivable. Compare:
- How it is expressed: a percentage of the dwelling, a stated dollar amount, or an unlimited amount
- Whether there is a time cap, and how long
- Whether it contemplates comparable housing or the cheapest adequate alternative
- How it interacts with a long rebuild, which custom and older homes routinely have, and which whole regions have after a widespread catastrophe
The failure mode 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. First, percentage deductibles are calculated against the dwelling limit, so on a large limit they can be substantially more than the flat all peril number. Second, a separate catastrophe deductible can be present on one quote and absent on 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
For 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 is there a condition allowing the carrier to reassess after an inspection? See wildfire home insurance.
Earthquake. Excluded on essentially every homeowners form. If you want it, it is a separate policy or endorsement with its own limit and percentage deductible. Compare 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 is not 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 is silent on one of these is not 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 there are any. See domestic employee insurance
Then check what the umbrella adds beyond limit: excess uninsured and underinsured motorist coverage, personal injury coverage, and defense arrangements. See how much umbrella insurance do you need and how to choose your liability limits. Nobody needs to state a net worth to do this.
Step nine: find the conditions that have not happened yet
This is the step almost everyone skips, and it is the one that turns a good quote into a bad placement.
Ask of each quote:
- Is this subject to an inspection that has not been completed?
- What does the inspection look at, and what is the timeline?
- If it produces required repairs, what is the deadline and what happens if they are not done?
- Can the carrier change the dwelling limit, add a condition, or withdraw after inspection?
- Are there any subjectivities outstanding, such as a proof of prior coverage, an appraisal, a mitigation certification, or a photo set?
A quote with unresolved subjectivities is a proposal, not a price. See high value home inspection.
Step ten: then look at the premium
Now the number means something. Compare it with the package structure in view, since credits for placing the home, autos, valuables and umbrella together change the arithmetic, and a standalone home quote against a package quote is not a fair fight.
One more question worth asking before you move anything: what would it cost to fix my current policy instead? Correcting the dwelling limit, raising ordinance or law, scheduling the items and setting the umbrella properly closes most of the common gaps without changing carriers. 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 are earlier in the process, standard versus high value home insurance explains what the two markets do differently, and how much does it cost to insure a million dollar home explains what drives the number.
If you would rather hand us the quotes than work the list yourself, request a coverage review and we will mark up whatever you have, including a proposal from another agency.