The economic term "perfect substitute" applies to products that are so similar there really is not point in trying to market differences to the public.
Regardless of techniques used, the majority of buyers will see one brand as exactly the same as another.
Salt is a good example of such a product.
All other products proceed along a scale away from the perfect substitute varying in degrees of difference among their closest competitors.
Home insurance is a product that while very close to the perfect substitute of salt, is still far enough away that aggressive marketing and advertising is used to convince the public that a difference does exist between cheap house insurance and more expensive insurance.
The old adage, you get what you pay for often rings true, but when it comes to cheap house insurance, do you? Homeowners insurance is not necessarily a product that can be judged based on price alone and so providers rarely compete based on price or coverage limits.
Limits of coverage are standard and are usually adjusted only at the request of the purchaser.
If a mortgage is attached to the property the minimum coverage of cheap house insurance is going to be the same as the minimum coverage from a more expensive provider as these minimums are determined by the lender not the insurance company.
The main point of differentiation in any advertising campaign among well known providers and providers of lesser known more inexpensive insurance seems to be based on the handling of claims.
Advertisers will make you believe that cheap house insurance will offer substandard service during a claim.
However, safeguards are in place during the home buying process that will assist one in determining if the company selected is acceptable.
Real estate professionals such as agents, appraisers, underwriters and so forth all come together during a closing to verify if the documentation presented is acceptable.
At this time opinions can be offered on the acceptability of the insurer chosen.
Provided the source is unbiased it may be well worth taking such advice as often times these people have been privileged to information not normally available.
Furthermore these are individuals that are representing entities, such as the lender, which have a vested interest in making sure the home insurance is acceptable.
Unknown inexpensive home owners insurance purchased by their clients may have a great reputation regarding claim assistance and price adjustments.
More expensive carriers may have a reputation for unreachable customer service or complicated discount formulas.
Such insiders are just one source to judge whether cheap house insurance is worth purchasing.
Another more obvious source is the Better Business Bureau which has listings of various companies and if grievances have been filed.
House insurance is a product that is required by lenders and thus has more stake holders than just the purchaser.
It is regulated and scrutinized by financial entities that have a vested interest in making sure that all policies including inexpensive ones, will provide the coverage outlined in the policy.
This may be a product whose differences lie largely with the creative forces behind commercials.