If wildfires rage in the forests near your home, are you protected? Montana is known as “Big Sky Country,” but that vast expanse of sky is also home to 3,443,038 acres of forest – and unfortunately, that forest is sometimes prone to unexpected blazes. Wildfires caused more than $10.9 million in damages in 2015 alone.

Purchasing a home is the start of an exciting chapter in your life, but you need to make sure that home is protected against the various forces that threaten it, including wildfires, severe weather, and mechanical failures. We set out to find Montana homeowners insurance companies that were reputable, friendly, and fiscally responsible. Whether you are a seasoned homeowner or a first-time homebuyer, our top picks for best homeowners insurance in Montana can give you the peace of mind you’re craving.

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The Best Homeowners Insurance in Montana

Freshome’s Recommended Homeowner’s Insurance Companies in Montana: State FarmAmicaGEICOFarmersTravelers InsuranceAllstate

We know homeowners insurance can be a complicated matter. Your premiums are affected by the amount of coverage you need, where you live, and numerous other variables.

At Freshome, we’ve discovered that Amica, State Farm, and Farmer’s are three of the best companies for a Montana resident, but Traveler’s, GEICO, and AllState also offer competitive policies and rates that won’t break your budget. We took the liberty of obtaining a few sample quotes to give you an idea of what to expect.

Methodology

In order to get similar estimates in all three tests, we used the following criteria: a 30-year-old nonsmoking male buying insurance for his first home. The home is a 1,144-square-foot bungalow built in 1996 that’s situated in Helena, Montana. Our fictional homeowner has no pets, no prior claims, and is gainfully employed with a bachelor’s degree. The home requires $120,000 in coverage for full replacement costs; in addition, we strove to obtain quotes for an HO3 policy.

We scrutinized the insurance companies as well. Every company we looked at holds a J.D. Power Overall Satisfaction score of three or more stars, as well as an A.M. Best Financial Strength Rating of B+ or higher, with an equivalent score from Moody’s and/or Standard & Poor’s. When shopping for insurance, you want to be sure the company is capable of paying your claim even in the midst of a disaster.

Benefits of an HO3 Policy

HO3 policies are the most popular and most common type of homeowners insurance policies in the country, and for good reason: HO3 policies are known as an “open peril” policy.

An open perils policy protects your home against all threats except those specifically excluded in the text. While all policies differ (and you should read the fine print to find out what your policy does and does not cover), the majority of open peril policies cover damages due to:

  • Fire and lightning
  • Windstorms and hail
  • Explosions
  • Theft, vandalism, and other forms of mischief
  • Vehicles
  • Smoke
  • Falling objects like airplane parts, fireworks, and even meteorites
  • Crushing weights of ice, snow, and sleet
  • Sump pump problems
  • Frozen pipes

On the other hand, a named perils policy protects against only the damages listed in the policy itself.

A good rule of thumb is to combine an open perils and a named perils policy to provide your home with the maximum amount of coverage you can obtain for it. Insurance policies are typically divided into six areas of coverage:

Coverage A is dwelling coverage. This is the amount of coverage necessary for a full replacement and rebuild of your home in the event of a disaster. It’s the type of coverage most people are familiar with.

Coverage B protects the other structures on your property. This coverage is usually limited to 10 percent of Coverage A and helps to replace detached garages, storage sheds, fences, and other structures.

Coverage C protects the contents of your home. This amount is typically 70–80 percent of Coverage A but can be modified to suit your personal needs. If you own items of extreme wealth (family heirlooms, paintings, jewels, etc.), then you should consider taking out separate policies on any item whose value exceeds your coverage amount.

Coverage D is loss of use protection. This is the amount that is paid out to cover accommodation costs while your home is being reconstructed.

Coverage E is personal liability protection. If you are sued for any reason, this coverage helps create a barrier between the lawsuit and your personal assets. If you feel like you need more liability protection, a personal umbrella policy can provide even more coverage.

Coverage F is medical payments. This coverage is in place to help pay the medical bills of anyone who is injured on your property. Whether you are at fault or not, many companies pay this amount automatically.

Quotes

The following quotes were obtained using the scenario laid out above. All three were obtained through the online estimate forms.

Amica gave a quote of $54 per month for 10 months or $536 per year. Amica doesn’t charge monthly rates; instead, they set up a payment plan, often as an addition to your mortgage. This quote included $120,000 in dwelling coverage, $12,000 in extended structure coverage, and $90,000 in personal property coverage. Loss of use coverage was estimated at $36,000, while personal liability protection and medical payment coverage were $500,000 and $5,000, respectively.

Our Quotes
Amica$536
Farmers$674
State Farm$1,100

State Farm provided a quote of $92 per month or $1,100 per year with a $2,000 deductible, making them the most expensive of the three. For this amount, State Farm gives $120,000 in dwelling protection, $12,000 in extended structure coverage, and $90,000 in personal property coverage. State Farm doesn’t provide an exact amount for loss of use; instead, they pay out the actual value of the loss upon the time of the claim. Personal liability coverage is $100,000 and medical payment coverage is $1,000.

Farmer’s quoted $56 per month and $674 annually with a $1,500 deductible. They provided $131,000 in dwelling coverage, $6,550 in extended structure coverage, $52,400 in personal property protection, and $13,100 in loss of use coverage. Upon obtaining a quote from Farmer’s, you are given three different plan options of various premium amounts. The plans with higher premiums have lower deductibles and other benefits. When searching for a quote, pay close attention the the options that are given to you.

What You Should Know Before Getting a Quote

Whether you’re buying homeowners insurance for the first time or searching for better coverage on your home, there are a few things to keep in mind. The first and most important aspect is this: buy full coverage. Experts recommend as much as 110– 125 percent of your loan amount or home value in order to cover the cost of replacement. Remember that replacement isn’t just the material cost of your home, but also the time and labor of those that will rebuild it.

Types of Coverage

It is always a good idea to consider an HO3 policy. Even though the broad-spectrum coverage of this type of policy may be more expensive, the vast range of protection it offers is worth it.

The flatlands of Montana make it vulnerable to severe weather. As realtor Tanya Smith says, “Probably the biggest cause of damage is hail. It’s not as common as fire, but it’s devastating. It took probably a year for the majority of homes to get fixed after the 2010 hailstorm. There was one street that looked like shrapnel.”

The average cost of homeowners insurance in Montana is roughly $70 per month, or $843 annually. While these rates may seem deceptively low (16 percent below the national average), don’t underestimate the risk. You should seek coverage that protects your home against a variety of threats, including but not limited to wildfires, tornadoes, and floods.

What information should I have when looking for a quote?

When applying for a quote, there are a few pieces of information that you’ll need to have on hand to expedite the process:

  • The age of your home and when the roof was last replaced
  • The total square footage of your home, including finished basements and garages
  • The distance to the nearest fire hydrant and fire department
  • The distance from the police station
  • The construction material of your home and the type of siding
  • The type of heating system inside your home
  • Information about prior insurance claims
  • Social Security number, home address, and amount of coverage desired

A note on entering your Social Security number: while many companies don’t explicitly state this, entering your Social Security number generates an inquiry on your credit report. While these inquiries won’t affect your credit score, too many of them in a short time span may generate questions if you try to get a loan.

What Can Affect My Premiums?

Insurance rates are affected by factors both in and out of your control:

  • The location and age of your home
  • Your prior homeowners insurance claims
  • Whether you smoke or not
  • Recent renovations
  • Type of heating system
  • Your deductible

In fact, several of these factors can reduce your rates. Recent renovations to your home may make it more secure and less likely to suffer damages due to weather. Installing a security system with off-site monitoring can give you a discount. So many house fires start as a result of unattended cigarettes that most companies offer a discount to nonsmokers.

Flood Insurance

As with most other states, flood insurance isn’t included in standard policies. Montana is home to a number of 100-year floodplains; that is, areas where severe flooding is estimated to take place every 100 years on average. A home in Montana has a 26 percent chance to be damaged by flooding over the course of a 30-year mortgage.

If you’re considering flood insurance (and you should be), check out the National Flood Insurance Program (NFIP) website for more information.

Why Are Montana’s Rates So Low?

The average homeowners insurance rate in Montana is only $843 per year, a full 16 percent under the national average. Despite the frequency with which wildfires, hailstorms, and other severe weather conditions hit the state, premiums remain low. Insurance companies issue standard rates across the entire state, which helps to bring down the average.

Unfortunately, Montana does not have a FAIR plan like so many other states. The Fair Access to Insurance Requirements Plans were created in the 1960s to allow people who had previously been turned down for insurance the chance to protect their home. Due to this absence, many homeowners have found themselves issued higher rates because of claims outside of their control.

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FAQs

What are common coverage gaps?

The most common coverage gap in any homeowners insurance plan is flood insurance. In addition, earthquake coverage is also left out. Even if you don’t think earthquake coverage is necessary, Montana has been called “earthquake country” in the past.

Also, many policies do not cover sump pump backups or frozen pipes.

What about flood insurance?

Flood insurance is absolutely necessary no matter where you live. Even if you aren’t at risk for flooding due to natural reasons, a frozen pipe is all it takes to fill your home with several inches of water and cause thousands of dollars of damage.

How often should I re-examine my policy?

Take the time to look at your homeowners insurance policy at least once per year. If you do any major renovations in that time, you should make sure the estimated value of your home hasn’t exceeded your amount of coverage; if it has, contact your insurance company and make adjustments as necessary.

Take Action

The main takeaway from this article is simple: be proactive. If you wait until you make a claim to find out if you have enough coverage, you could be in for a nasty surprise. Shop around; talk to several different companies and guarantee that you have enough in dwelling coverage to rebuild your home from the ground up should the worst happen.

Freshome’s Recommended Homeowner’s Insurance Companies in Montana: State FarmAmicaGEICOFarmersTravelers InsuranceAllstate

Compare Homeowners Insurance Rates

To quickly find and compare rates in your area, enter your ZIP code below.

Enter Your ZIP Code: