Homeowners insurance companies rates can vary from one company to the next as much as 100 percent for them same amount of coverage. It is crucial to shop around for the best insurance policy. While making comparisons write down quotes for equivalent coverage. You will want to know whether the insurance carrier has a reputation for prompt and dependable claims service, so it's a good idea to check references.

California law prohibits a lender from requiring the borrower to carry fire insurance in excess of the replacement value of the improvements on the property, even if this is less than the loan amount. However the borrower's property insurer must establish replacement value.

Underinsuring a property can result is serious consequences. Even over-insuring your home can result in major money wastes. Guaranteed replacement cost coverage provides the widest range of coverage available if the home is insured 100 percent of the cost to replace the structure. The entire structure must be replaced at the insurance owner's expense with guaranteed replacement cost coverage. This applies even if the cost to rebuild is more expensive than the coverage amount. Without this type of important coverage the insurance company will pay up to the coverage amount, even if the price to rebuild is higher. Also look out for policies that offer guaranteed replacement cost coverage but put a cap on the amount of a single loss.

By selecting a policy with a high insurance deductible you can save a significant amount of money. The amount of savings by opting for a $500 or $1,000 deductible over a $250 deductible will vary from one company to the next.

If you are paying all cash for your home, it is strongly advised that you insure your property for its replacement value at the close of escrow. All buyers who take out a loan are required to insure the home with a fire insurance policy that names the lender as the loss payee.

You also should consider adequate personal property coverage to protect yourself against the loss of your personal belongings. In addition to personal property coverage, you should consider liability coverage to protect against claims for injury or damage to another.

Another common addition to a standard homeowner's policy is earthquake insurance. Earthquake insurance usually carries a very large deductible, about 5 to 10 percent of the replacement cost. If you live in an older home, the insurance company may require that your home be secured to the foundation with anchor bolts. This can be installed by your local contractor or structural pest control company.

If you live in a flood prone area you lender might require you to obtain insurance through the National Flood Insurance Program.

Insurance agents will want detailed information about the property being covered prior to issuing the insurance policy. Insurance agents will commonly want to physically inspect the property.

There are insurance premium discounts available if the home has a smoke and security alarm, close to a fire hydrant, is new or remodeled.