How is homeowner’s insurance paid

Closing on a new house?

The process of buying a house can be confusing. So much going on, so fast, then so slow while you wait, and then fast again.

Truly understanding the process can be overwhelming and difficult.

As you are getting ready to close on the house you find out you need to pay your homeowner’s insurance in full. You do what they ask, pay the premium, and close on your new house.

Then what?

How is my insurance going to be paid in the future?

Do I always have to pay in full or can I make payments? What about my escrow account?

How is homeowner’s insurance paid

After you pay the initial homeowner’s insurance premium in full at the time of closing, your insurance can be set up in two separate ways.

Either Escrow Billed or Direct Bill.

Escrow Bill

Escrow bill means your homeowner’s insurance premium will be invoiced to your mortgage company, just as it is for your taxes.

Each month your mortgage statement will have a portion for escrow. So a portion of your payment will be applied to your principal, interest, and escrow.

The Escrow account will then pay your taxes and insurance premiums as the invoice is due.

Direct Bill

If you choose not to roll your insurance into your escrow account or the bank/mortgage you have is not set up to do so, then you will be responsible to pay the insurance premiums going forward.

You can continue to do this annually if you choose or you can set it up on installments.

If you have your auto and home insurance packaged with the same insurance company it is very easy to turn that into a combo billing plan so get one bill or withdrawal for both policies.

YouTube video


What’s Next?

As we mentioned, it is very confusing and frustrating when going through the closing process of a new home. Being educated on what the options are is extremely important during this time.

By dealing with an independent insurance agent for your home insurance needs, they will be able to help walk you through the process and make it easy to understand.

If you do not have a relationship with your agent, click the button below to get started with one of our trusted insurance advisors.



Getting the process couldn't be easier! Enter some basic info below to start the process right now:


Visit Our Office

202 N. Center St.
East Syracuse, NY 13057
Call Email Claims Payments