Will your insurance company be there for you in the aftermath of a disaster, when you most need it? The answer might be no.
When Consumer Reports National Research Center surveyed readers about their homeowners insurance claims in the last few years, half of those who had filed claims related to Hurricane Katrina reported problems. That's twice the rate of problems reported by other respondents. Twenty-six percent of Katrina victims said they were paid too little, compared with 11 percent of others. A disaster tests everyone, and in the eyes of our readers insurers often failed that test.
Even if you're nowhere near a hurricane zone, you could face catastrophe in the form of fire, wind damage, or a lawsuit. It's in those dire situations that you truly need coverage that lives up to its promises. Yet our evaluation of home insurers found that doesn't always happen. You can find excellent insurers, but you can also face a maelstrom of complexity, cost, and difficulty getting your due. Here are highlights of our findings:
Still, we found good news, especially for people with decent credit and claims history.
Lots of folks are finding lower prices. A fifth of respondents said they had been with their company for four years or less. Of those, more than half said they had found a better premium with their new carrier.
And consumers are reasonably content. Overall, 73 percent of respondents were highly satisfied with their current carrier. That compares with a satisfaction rate of 77 percent in 2003, the last time we published ratings of homeowners insurance. Only 5 percent indicated their claims were rejected, and 11 percent said they received too little payment for their claims. The remaining 84 percent were satisfied with the settlement of their claims.