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Maryland boasts picturesque scenery that changes with each season, a historic trading port, and a number of charming towns. It's also a landlord-friendly state, which is why it has attracted investors from far and wide.
Whether you have purchased your Maryland home as an investment or as a place to start a family, it's important to protect it with homeowners' insurance.
The truth is that no state in the US is truly immune from natural disasters, and while Maryland hasn't seen as much devastation as some of the other states in the US, some homeowners have seen damage to their properties because of hurricanes, tornadoes, and floods.
However, navigating homeowners' insurance in Maryland is no easy task, with a plethora of insurance companies all claiming to offer great deals. To help you make an informed decision and ensure that your greatest investment is adequately protected, we have created this comprehensive guide.
Here, you'll learn more about homeowners' insurance and how to choose the right insurer. You can also find reviews on our top five picks for home insurance in Maryland. Let's get started!
Understanding Maryland Homeowners' Insurance
Homeowners insurance offers financial protection for a home and its contents against different risks such as theft, vandalism, fire, and other unforeseen events.
It provides protection from loss by assisting with the repair or replacement of their home and valuables if they are damaged or destroyed as a result of covered events. Furthermore, home insurance usually includes liability coverage, which is designed to protect the homeowner in the event a person suffers harm on their property and files a lawsuit for damages.
Average Home Insurance Costs in Maryland
According to Bankrate, the average annual premium for a homeowners' insurance policy is $1,164 for $250,000 in dwelling coverage. However, it is important to remember that the cost will depend on a variety of factors. This includes the following:
- The coverage options you choose
- Location of the property
- The age and condition of your home
- Replacement cost (the cost to rebuild your home)
- Maintenance practices
- Security features
- Your claims history and credit rating
The truth is that most homeowners' insurance companies offer discounts for bundling your insurance policies. If you take home and auto insurance policies from the same insurance provider, you could qualify for a discount.
There are other ways to save money, too. By signing up for automatic payments, for example, you can enjoy a reduced monthly repayment.
You must do your research to learn more about the various discounts offered before choosing your insurance provider.
Homeowners Insurance vs. Landlord Insurance
It's important to remember that homeowners' insurance may not provide guaranteed replacement cost coverage if you have tenants living on the property. In such cases, landlord insurance may be more suitable.
Homeowners insurance is meant to provide protection for people who own and live in their homes. It covers both the house and the personal items they contain. It also offers liability coverage in the event of an injury on the property. Landlord insurance, on the other hand, is designed for property owners who lease their properties to tenants.
It protects the building itself, any landlord-owned items on-site, rental income lost due to covered occurrences, and liability resulting from tenant-related mishaps. Landlord insurance recognizes the specific risks associated with renting a property by providing coverage for the landlord's rental company while omitting coverage for tenants' personal items.
Let's look at some of the scenarios where homeowners' insurance would be a suitable option.
Vacant Property
In some cases, properties may lie vacant for various reasons. Sometimes, it could be inhabitable or left vacant because the property owner chooses not to allow tenants to occupy their holiday homes. Whatever the reason, it's often best to have homeowners' insurance coverage to ensure that you are covered in the event that there is damage to the property.
Temporary Absence
If you intend to go abroad for work or travel to a different state for a month, it's important to ensure that your home is adequately protected with suitable coverage. If the temporary absence is because you're looking for a new tenant, then it's probably best to have landlord insurance. When in doubt, always obtain advice from your insurance provider to ensure that you have the right kind of coverage.
Transition Period
Should you choose to live in your rental property while you wait for a new tenant, it's probably best to have homeowners' insurance to ensure that you are adequately covered in the event that something goes wrong.
Home Sharing
Do you intend to have a roommate or lease a portion of your property to a tenant? In that case, it might be a good idea to have homeowners' insurance to ensure that you have sufficient coverage for your personal property. However, keep in mind that this does not cover you for lost rental income, so seek expert advice from your insurance company for more advice on which option to go for.
How to Choose a Maryland Homeowners Insurance Company
If you decide that homeowners' insurance is indeed the right option for your property in Maryland, then you will need to find a suitable home insurance company. However, knowing what to look for and how to go about making your choice can be confusing, which is why we have created the following buyers' guide to ensure that you make a smart choice.
Unique Policy Needs for Maryland Homeowners Insurance
Although natural disasters are not a regular occurrence in Maryland, it's important to remember that it is no stranger to flash flooding, tornadoes, and hurricanes, so it's always better to be safe than sorry.
Because navigating the complexities of homeowners' insurance can be challenging, we'll talk a little more about the types of coverage options you should consider and the needs many homeowners just like you have.
Flood Insurance Coverage
According to the Federal Emergency Management Agency (FEMA), the majority of counties in Maryland are at a higher risk of flooding. The truth is that standard homeowners' insurance policies do not cover flood damage.
To acquire coverage under FEMA's National Flood Insurance Program or via a private insurance company, you need to buy an additional flood insurance policy. If your property is destroyed by storm surges or floods caused by a hurricane, flood insurance can typically assist in covering the costs.
Water Backup Coverage
This type of coverage is intended to compensate homeowners for water damage resulting from a sewage or drain line back up to the property's structure, personal possessions, or both. Water backups are typically seen in the basement in cases when the sump pump is unable to keep up with heavy rain, but it can occur from any sewage or drainage line.
Mold and Water Damage
Where there is water ingress because of backed-up utility lines or flash flooding, mold is bound to grow. This can lead to further damage to the surfaces of a home and reduce the quality of the air, leading to respiratory problems.
It's important to learn more about your policy limitations to determine whether you have the relevant homeowners' insurance required to cover you in the event that mold does start to grow in your home.
Evacuation and Additional Living Expenses
Another type of coverage that you need to think about is evacuation and living expenses. In some cases, a natural disaster might render your home inhabitable, or you might need to evacuate because of a threat. Having suitable coverage if you live in an area that is notorious for serious natural disasters is essential.
Other Factors to Consider When Assessing Maryland Home Insurance Companies
In addition to the type of coverage you will need, there are other things to think about before you acquire homeowners' insurance in Maryland. The truth is that home insurance is a safety net designed to protect you, and it's often a long-term commitment, so it's important not to go in without conducting research.
Here are a few steps you should follow to ensure that you are making an informed decision:
- Start by determining your own needs. Before you approach an insurance company, you must first think about what you want from your insurance plan. Do you need to have additional flood insurance because your area is particularly prone to these events? Will you require earthquake coverage? It's important to list your requirements so that you do not lose focus of your objectives and end up with insufficient coverage.
- Shop around before making your choice. Shopping around might offer you a better sense of your budget and coverage options. Every home insurance company has its own coverage limits, price ranges, and discounts, so make sure you're looking closely at these factors before making your choice.
- Look at the cost. While finding the cheapest homeowners' insurance policy might be tempting, it's important not to look at cost alone. Request quotes from several providers and compare them to see which one offers the best value for money with the endorsements you are looking for.
- Assess the company's financial stability. Another factor that many overlook is the financial strength of the insurer. You can use independent agencies such as A.M. Best Company or Demotech for this.
- Customer service. When working with an insurer, you must ensure that the insurer provides excellent customer support. You should be able to turn to the company for assistance when navigating the intricacies of homeowners' insurance and be treated with respect when it's time to file an insurance claim. A great way to learn more about customer support is by looking at online reviews.
- Look at the discounts offered. Home insurance can be costly, so assess the different discounts that the company provides and use that to determine which company would offer the best value for money.
Although it might seem cumbersome to follow these steps, you must remember that homeowners' insurance is a long-term commitment and a safety net designed to safeguard you if something goes wrong. This is why you should never jump in without spending enough time on research.
The Best Home Insurance Companies in Maryland
Using the criteria listed in the buyers' guide above, we have devised a list of suitable candidates to make the process of finding a reliable home insurance company in Maryland easier. Here are our top five picks:
1) State Farm
As one of the largest insurance providers in the United States, it should not be surprising that State Farm has made it to the top of our list. We highly recommend it because of its outstanding customer service, strong financial stability, and extensive range of add-ons.
Coverage and Features
When you insure your home with State Farm, you can expect the following types of coverage to be included as part of the standard homeowners' insurance policy:
- Dwelling and extended dwelling coverage (covers your home and any other features, such as garages)
- Personal property coverage
- Medical payments (payment of any liability claims)
- Loss of use (in the event that your home becomes temporarily uninhabitable)
You can also obtain a number of additional policies, depending on your needs. Here are some of the options available:
- Service line coverage
- Umbrella coverage (covers anything that standard liability coverage doesn't pay)
- Coverage for home systems (such as air conditioning)
- Water backup and sump pump coverage
- Coverage for off-property structures (structures you own that are not on the property)
Since so many options are available, it is important to talk to an insurance agent to ensure that you find a solution that best meets your unique needs.
Discounts
State Farm offers a number of discounts for homeowners hoping to find affordable insurance coverage. This includes the following:
- Claims-free history. You can save on your monthly premiums if you have not filed any recent homeowners' insurance claims.
- Security systems. If your property has certain security features, such as burglar alarms, a fire extinguisher, or a security system, you may qualify for a discount.
- Policy bundling. By taking more than one policy from State Farm, you can save money on your insurance.
- Higher deductibles. You can also save money on your insurance premiums by choosing a higher deductible amount. However, if you select this option, you will have to keep in mind that you will end up paying a higher out-of-pocket amount when you file a claim.
2) USAA
Are you a US veteran, an active member of the army, or a family member of someone who is? In that case, you will qualify for USAA home insurance coverage. It has several features that are optional add-ons with other private insurers, so if you fall into one of these three categories, we highly recommend giving USAA a try.
Coverage and Features
USAA's standard insurance policies include the most typical inclusions, such as loss of use coverage, dwelling coverage, liability coverage, and personal property coverage.
Replacement cost coverage, which covers the value of your assets without considering depreciation, is also included in standard plans. USAA insurance also features up to $5,000 in identity theft protection as part of its standard home insurance coverage.
Discounts
Veterans and military members can expect to receive the following discounts on their insurance premiums:
- Discount for protective devices and security systems
- Claims-free discount
- Reduction in premiums for bundling insurance policies
3) Travelers
If affordability is important to you, then Travelers is a great option to consider. The company has a high A.M. Best rating and a long-standing reputation, considering its 165-year track record.
Coverage and Features
A basic home insurance policy from Travelers covers your home, any additional structures on the premises, personal valuables, personal liability, medical payments, and loss of use.
It offers similar extras to other companies on this list, such as coverage for expensive belongings, water backup, identity theft protection, and more. You also have the option to add "green" coverage, which would assist by paying the cost of repairing or replacing things with sustainable or high-efficiency materials following a covered event.
Discounts
Unlike many of the other insurance providers on this list, Travelers doesn't offer many discounts. Nevertheless, it does provide affordable insurance premiums, so it is definitely worth looking into if you're hoping to save on homeowners' insurance in Maryland.
Having a security system and bundling your policies will earn you a reduction in premiums with Travelers.
4) Chubb
Chubb has a global presence and offers comprehensive solutions to help high-end homeowners obtain specialized services. The company was founded in 1882 and has built a stellar reputation in the industry.
Coverage and Features
According to the National Association of Insurance Commissioners, Chubb offers its services to high-value houses and receives significantly fewer client complaints than would be expected for an organization of its size. Its home insurance packages have some wonderful benefits, such as an extended replacement cost in the event that rebuilding your property after a calamity exceeds your dwelling limit.
Insuring a second or summer home in Maryland gives you the option to take advantage of the company's free Property Manager service. A Chubb specialist will examine the property after a natural disaster, report its state to you, file an insurance claim on your behalf, and assist you in preventing further damage.
You can also personalize your coverage with a wide range of add-ons that include earthquake insurance, flood coverage, and additional coverage for valuable items.
Discounts
Are you looking for a discount on your home insurance premiums? In that case, you'll be happy to know that Chubb offers a wide range of options. This includes the following:
- A claims-free discount
- Discount for newly constructed or renovated home
- Multi-policy discount
- Reduction in premiums if you have a backup generator
- Security and fire resistance discount
5) Erie Insurance
Erie Insurance is another option worth looking into. It offers competitive pricing and great customer service. However, unlike other insurers that offer online tools, Eerie requires that those interested speak with an insurance agent. This is a minor setback, but it is one of the reasons it is the final option on this list.
Coverage and Features
One of the things we really like about Erie is that it offers guaranteed replacement cost coverage as part of a standard homeowners' insurance policy, which you don't get with many other insurance providers. You can expect industry-standard coverage from Eerie, which includes the following:
- Dwelling coverage of $336,000
- Other structures coverage of $67,200
- Medical payment of $1,000 per person
- Loss of use coverage of $67,200
- Liability coverage of $300,000 per event
- Personal property coverage of $235,200
Discounts
Although not as extensive as the other insurance companies on this list, Erie does have a discount structure for those hoping to save on their monthly premiums. One of the ways you can save is by bundling your insurance policies.
You can also expect to receive a discount if you have protective devices, such as a security system, installed on the property. The company also provides a discount if you obtain a quote at least one week before it's time to renew your policy.
Other Notable Maryland Home Insurance Companies
If you would like to explore other options, be sure to check out the following Maryland homeowners' insurance companies:
- Allstate
- Farmers
- Nationwide
- Amica
With so many options to choose from, it's important that you outline your goals and objectives before taking your pick and talk to your chosen provider about the best type of coverage for your area.
Conclusion
With so much to offer, Maryland is a great place to call home. However, nothing is ever perfect, and unforeseen events can turn your life around in ways you never expected. That's why protecting your most significant asset with homeowners' insurance is so important.
With a plethora of options for Maryland residents, it's important to spend enough time doing research to ensure that you are making smart choices. Be sure to consider the risks that you face and be bold enough to approach many insurance providers before you settle.
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