Shopping For Insurance With Best Premium and Terms

When you are buying a home, shopping for insurance is just as important as shopping for your mortgage. The homeowners’ policy you choose protects your biggest investment and helps determine your final monthly payment. Your lender cannot clear your loan to close until they receive your homeowners’ insurance declaration page, so you cannot afford to treat shopping for insurance as a last-minute chore.

Done right, shopping for insurance can save you hundreds of dollars per year and tens of thousands over the time you own your home. Done wrong, you can end up overpaying for weak coverage that leaves you exposed when you need it most. This guide focuses on shopping for insurance specifically during the mortgage process, so you know exactly what to expect.

Key Takeaways: Shopping for Insurance During the Mortgage Process

• • Shopping for insurance is not optional or a last-minute decision. Your lender needs a homeowners insurance declaration page before issuing a clear-to-close, so you should start shopping for insurance as soon as your purchase contract is accepted.
  • The policy you choose directly affects your monthly payment. Because homeowners’ insurance is escrowed, smart shopping for insurance can lower your overall PITI and save you money every month.
  • Coverage matters just as much as price. When shopping for insurance, compare coverage limits, deductibles, and exclusions—not just the cheapest premium—to make sure your new home is properly protected.
  • Independent agents can do the heavy lifting for you. Working with a broker or independent agent who has access to multiple carriers can make shopping for insurance faster and more effective.
  • Early, strategic shopping for insurance prevents closing delays. By getting quotes, choosing a policy, and sending the declaration page to your loan officer ahead of time, you avoid last-minute stress and keep your closing on track.

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Why Homeowners Insurance Matters When You Are Buying a Home

Homeowners insurance protects you and your lender. It covers your home’s structure, damage from certain events, your belongings, and your liability if someone gets hurt on your property. Since the home secures your mortgage, your lender requires you to have this coverage from day one.

Typically, this insurance is included in your monthly mortgage installment, which encompasses the principal, interest, taxes, and insurance—commonly referred to as PITI. If you grab the first quote you see, you could end up paying way more than you need to every month. Taking some time to look around for better insurance options can really help you keep your housing costs in check.

When to Start Shopping for Insurance During the Mortgage Process

Many buyers wait until the last week before closing to look at homeowners’ insurance. That often leads to stress, last-minute scrambling, and higher premiums. A better approach is to start shopping for insurance as soon as your purchase contract is accepted and you have basic information about the property.

Starting early allows you to:

• Get several quotes instead of settling for the first one.
• Ask questions about coverage, deductibles, and exclusions.
• Coordinate the policy effective date with your closing date.
• Give your loan officer the declaration page well before the clear-to-close.

Think of shopping for insurance the same way you think of rate-shopping your mortgage: it is a key financial decision, not a box to check.

Step-by-Step Guide to Homeowners Shopping for Insurance

The steps below guide you through the process of shopping for insurance for your new home, from start to finish.

1. Decide What You Need From Your Policy

Before you start calling agents or filling out online forms, take a moment to define your needs. Shopping for insurance is much easier when you know what you are asking for.

Key coverage areas include:

• Dwelling coverage: The cost to rebuild or repair the home after a covered loss.
• Personal property: Furniture, electronics, clothing, and other belongings.
• Liability coverage: Protection in the event that someone is injured on your property and you are held responsible.
• Loss of use/additional living expenses: Covers the cost of temporary accommodation if your residence is uninhabitable following a covered claim.
• Optional endorsements: Flood, earthquake, sewer backup, or higher limits for jewelry, guns, or collectibles, depending on your situation and location.

2. Gather Property Details Before You Request Quotes

Accurate information produces accurate quotes. Before you begin serious shopping for insurance, collect key details about the home:

• Address and year built
• Square footage and construction type
• Roof material and approximate age
• Electrical, plumbing, roof, or HVAC updates
• Safety features like smoke detectors, deadbolts, and monitored alarm systems.

Much of this will be in the listing, inspection report, or appraisal. Having it ready makes shopping for insurance faster and keeps your quotes consistent.

3. Get Multiple Quotes When Shopping for Insurance

Never rely on a single number. A good target is at least three to five homeowner quotes. When comparing insurance quotes, ensure each one has the same coverage limits and deductibles. That way, you can really compare them properly.

You can get quotes by:

• Contacting individual insurance companies directly
• Working with an independent insurance agent who has access to many carriers
• Using online comparison tools and then following up with a live agent

An experienced independent agent can often do much of the shopping for insurance on your behalf by checking several carriers at once and narrowing down the best options for your property and budget.

4. Compare Coverage First, Price Second

One of the biggest mistakes people make when shopping for insurance is focusing solely on the premium amount. A cheap policy with poor coverage can cost you far more at claim time than you saved up front.

When you compare quotes, look closely at:

• Coverage limits: This refers to the protection for your home and personal belongings.
• Deductibles: For standard claims and, if applicable, separate wind/hail or hurricane deductibles
• Exclusions and limitations: Water damage, mold, specific dog breeds, or other items that might not be covered
• Settlement type: Whether the policy pays actual cash value (depreciated) or replacement cost

You want a policy that strikes a balance between price and protection. Smart shopping for insurance means you understand what you are giving up (or gaining) with each quote, not just how much it costs.

5. Ask About Discounts and Bundling

As you shop for insurance, ask each company or agent what discounts may be available to your specific situation. Common savings opportunities include:

• New home or recently updated home
• Monitored alarm or home security system
• Fire sprinklers and smoke detectors
• Claims-free or good insurance history
• Higher deductibles if you can comfortably handle a larger out-of-pocket expense

You can also ask whether bundling home and auto with the same company will reduce your total cost. Even though your auto policy is not part of the mortgage, bundling can make shopping for insurance more efficient and may lower premiums on both policies.

6. Coordinate Your Policy With Your Loan Officer

Once you have chosen a policy, the final step in shopping for insurance is to ensure that your lender has all the necessary information. Ask your agent to send the homeowners’ insurance declaration page directly to your loan officer and to list your lender as the mortgagee on the policy.

Confirm that:

• • The effective date matches your closing date
  • The premium amount matches what your lender is using for PITI
  • The coverage meets any special lender requirements (such as condo master policies or flood insurance in required zones)

 

How Better Insurance Shopping Can Lower Your Mortgage Payment

Because homeowners’ insurance is typicallya escrowed, your premium is included in your monthly mortgage payment. If your annual premium is $2,400, you are effectively adding $200 per month to principal, interest, and taxes. If you find a solid policy for $1,200 instead, your monthly payment drops by about $100.

For many first-time buyers, careful shopping for insurance is one of the only remaining ways to bring the payment into a comfortable range late in the process. You may not be able to change the purchase price or interest rate at that point, but you can still make wise decisions about your insurance premium.

Brokers vs Captive Agents: When You Are Shopping for Insurance

When you are shopping for insurance, you will typically work with one of two types of professionals:

• Independent or broker agents: They can quote many different carriers and present you with several options.
• Captive agents: They work for just one insurance company, so they can only sell that company’s stuff.

Neither type is automatically better in every situation, but an independent agent often has more flexibility when shopping for insurance on older homes, unique properties, or higher-risk areas. What matters most is that your agent understands closing timelines, communicates quickly with your lender, and helps you choose coverage that truly protects your new home.

Common Mistakes Homebuyers Make While Shopping for Insurance

To get the most benefit from shopping for insurance during the mortgage process, avoid these common errors:

• Waiting until the week of closing to start calling agents
• Choosing the cheapest quote without comparing coverage
• Underinsuring the home just to lower the premium
• Forgetting to ask about discounts and bundling options
• Failing to send the declaration page to the loan officer quickly
• Assuming all homeowners’ policies are basically the same

A little extra effort while shopping for insurance can help prevent closing delays, surprise premium increases, and unpleasant claim experiences later.

Make Shopping for Insurance Work for You

Shopping for insurance is one of the few pieces of the mortgage process that you can directly control. By starting early, gathering accurate information, getting multiple quotes, and working with the right professionals, you can protect your new home and keep your monthly payment as low as possible.

If you feel overwhelmed, consider speaking with your loan officer or a trusted insurance professional. With the proper guidance, shopping for insurance becomes a smart financial strategy instead of a last-minute headache.

Borrowers who need a five-star national mortgage company licensed in 50 states with no overlays and who are experts on homeowners insurance during the mortgage process, please contact us at 800-900-8569, text us for a faster response, or email us at alex@gustancho.com.
ong>Frequently Asked Questions About Insurance for Homeowners:

Why is Shopping for Insurance so Important When I am Getting a Mortgage?

Shopping for insurance is important because your lender requires proof of homeowners coverage before you can close, and the premium you pick becomes part of your monthly mortgage payment. Making better decisions up front can result in lower costs for years.

When Should I Start Shopping for Insurance for My New Home?

Start shopping for insurance as soon as your purchase contract is accepted. That gives you time to get several quotes, ask questions, and coordinate your policy with your closing date.

How Many Quotes Should I Get When Shopping for Insurance?

Aim for at least three to five quotes when shopping for insurance. Make sure coverage limits and deductibles are similar so you can fairly compare each option.

Should I Use an Independent Agent When Shopping for Insurance?

Working with an independent agent can make shopping for insurance easier because they have access to multiple carriers. They can often find competitive premiums and coverage tailored to your home and your lender’s requirements.

Can Shopping for Insurance Really Lower My Monthly Mortgage Payment?

Yes. If careful shopping for insurance helps you reduce your annual premium, the insurance portion of your escrow payment goes down. Even a difference of $600–$1,200 per year can reduce your monthly payment by $50–$100 or more.

This article about “Shopping For Insurance With Best Premium and Terms” was updated on November 13th, 2025.