Homeowners insurance, also commonly referred to as hazard insurance, is required on all properties that have a mortgage. Hazard insurance protects you, the homeowner, in case your home is destroyed by fire, damage in a storm, theft, etc... Hazard insurance is not to be confused with mortgage insurance, also commonly referred to as private mortgage insurance or PMI. PMI is insurance paid for by the borrower that protects the lender in case you default on your mortgage loan.

The cost of homeowners insurance often depends on what it would cost to replace the house and which additional riders—additional items to be insured—are attached to the policy. You can include your insurance payment into the mortgage payment so that it will not surprise you at years end when it is due in full.

Insurance quotes can vary by as much as 40-50% between companies for the exact same homeowners policy. Homebuyers and homeowners should request quotes from at least 4 different companies before deciding on one particular company.

For insurance quotes, there are hundreds of agencies out there. Some of the most well-known include State Farm, Erie, Prudential, Allstate, Farmers, Progressive, J.D. Power, MetLife, Travelers, AIG, Liberty Mutual, Amica, Geico, just to name a few.

Obtaining several insurance quotes before purchasing a homeowner's policy is recommended. When comparing insurance quotes, be certain that the quotes are for policies with similar coverage with the same deductible. Some examples of coverage's included in a typical homeowner's policy are: Dwelling, Other Structures, Personal Property, Loss of Use, Personal Liability, and Medical Payments to Others.

Unlike your mortgage, homeowners insurance can normally be modified or switched from carrier to carrier at nominal expense.