How to Lower Homeowners Insurance Costs
When shopping for Homeowners insurance coverage, be aware that premiums vary by insurance company and sometimes the difference in quote for a coverage can be significant. Each insurance company has their own underwriting guidelines and what is acceptable for one company may not be acceptable to another.
So whether you are buying home insurance for the first time or shopping to get better coverage than you have now, it pays to shop around and check the prices of multiple insurance companies before choosing a company to provide insurance coverage.
The amount you pay for insurance coverage is determined by numerous factors, including state laws, medical costs, rebuilding costs and administrative expenses. Many other factors unique to you and your home are also utilized, such as the amount of insurance you selected, construction of your home, age of your home, protection class, square footage, roof age, roof material and the location of your home.
As you shop, you need to know what kind of coverage you are looking for and it's always wise to ask your insurance agent about potential discounts on the cost of your policy. Below are a few things you can do to help get you a lower homeowners insurance cost.
How to save on Home Insurance Policy
Depending on the company you choose, you can get discounts for:
The first step is to shop around. Quotes on the same home can vary significantly from company to company.
Remember, you’re covering replacement cost, not market value.
Ask about discounts for safety and security devices. For instance you may be able to obtain discounts for installing smoke detectors, burglar alarms, dead bolts, or other available discounts.
In some high-risk areas, the federal or state government may back plans to lower rates. Ask your agent what’s available.
Insurance companies will often offer multi-policy discount if you buy your homeowner’s and auto policies from the same company. (For example: if you insure your car along with your home). However make sure the discount really yields the lowest price.
Insurers often use credit-based insurance scores to determine premiums.
Ask how the difference in your deductible affects the price of your policy. If you can afford to pay more toward a loss that occurs, your premiums will be lower. Also, avoid making claims for losses of less than $1,000.
For example, being a senior or retiree who tend to be home more than full-time workers may qualify you for a discount on theft insurance. You also may be able to obtain discounts for installing smoke detectors, burglar alarms, high-quality locks, sprinklers, or other improvements designed to mitigate particular hazards, such as wind shutters or reinforced roofing.
If you belong or have a membership in any associations, professional, alumni organizations, or business groups, check to see if they offer deals on coverage.
Newer homes or homes that are constructed using current, model building codes or that have been retrofitted against hail or windstorm may be eligible for credits or discounts.
Perform an annual insurance checkup to keep your policy current and keep you in the know before disaster strikes. Take a look at your policy limits and the value of your home and possessions. Look for items that have depreciated and may not need as much coverage.
Contact your home insurance company or agent and request a policy review. Ask these questions to make sure you have the right financial resources to rebuild, recover, and bounce back from any disaster.
Other Homeowners Insurance Tips
CLUE reports detail the property’s claims history for the last five years, which insurers may use to deny coverage. Make the sale contingent on a home inspection to ensure that problems identified in the CLUE report have been resolved.
You must obtain insurance in order to buy your home. And you don’t want to find out at closing time that the insurer has denied you coverage.
Related Content
What is an Insurance Quote:
An Insurance Quote is an estimate of what your premiums will be for a particular coverage with a particular insurer.
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