The Top Ways to Save on Home Insurance

December 30, 2019

If you have a mortgage, you have to have mortgage insurance – lenders require it. Even if you don’t have a mortgage, carrying home insurance is a good idea. While it’s not pleasant to think about a total loss – it happens. What would you do then? You need the financial protection that insurance provides.

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While home insurance is a necessity, it doesn’t mean you have to go broke paying for it. Read below to learn the top ways to save on home insurance.

Bundle Your Insurance

If you have more than one type of insurance, you may save by bundling the policies together. Many insurance companies offer discounts when you get both your car and home insurance with the same company. It’s worth asking about the discounts.

On average, homeowners save 5% – 25% on their homeowner’s insurance premium. Exactly how much you save depends on the insurance company and your qualifying factors. The savings are on each of the policies that you carry with the company.

Take a Higher Deductible

Your deductible is what you owe if you file a claim. You don’t have to take the first deductible offered to you. If you think you can afford more, ask for the higher amount. This will directly lower your premium. Just make sure it’s an amount you can comfortably afford. You can always switch the deductible if things change in the future and you can’t afford it any longer, but doing so before you need to file a claim is crucial.

Think about how much you have saved for emergencies and base your decision that way. For example, if you have $1,000 set aside for home emergencies, you may take a $1,000 deductible, knowing that you can comfortably afford it. In exchange for the higher deductible, you’ll get lower monthly premiums, if you end up with a claim, you’ll be responsible for the first $1,000 before insurance will pay its portion.

Add Security to Your Home

Insurance companies take a risk when they give you a policy. They risk the fact that you could file a claim due to fire, theft, vandalism, or other incidents. If you take certain security measures, though, you decrease the risk of these incidents occurring, which lowers the insurance company’s risk of paying out on a claim. This helps decrease your premiums.

A few ways you can increase your home’s security include:

  • Add a monitored anti-theft system
  • Add monitored security cameras
  • Install more secure deadbolts and other locks

Update Your Home’s Systems

Plumbing and electrical wiring systems become outdated over time. They may not even meet the local code. If you update the systems, you decrease the risk of water or fire damage. Your insurance company may provide lower premiums as a result.

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Maximize Your Credit Score

Some insurance companies use your credit score when determining your premiums. Typically, the higher a consumer’s credit score is, the less likely they are to file a claim. Insurance companies use this information to determine your premiums. Work on your credit score before you apply for insurance to get the best rates.

Limit the Number of Riders

You may have separate riders on valuable personal belongings. Standard homeowner’s insurance policies only go up to a certain amount. If your valuables exceed that amount, you’ll need separate coverage on them. Over time, though, your valuables may decrease in value or you may not even own them any longer. Keep a close eye on what you pay and if the coverage is still necessary, canceling any unnecessary riders.

Prepare for Disasters

If you live in an area known for disasters, such as hurricanes or floods, prepare your home accordingly. Installing stormproof shutters and reinforcing your roof are a couple of great ways to decrease the risk of damage during strong storms. Retrofitting old homes helps protect against earthquakes and upgrading your systems to prevent against fire help lower your premium.

Ask About Other Discounts

Every insurance company offers different discounts. Talk with your insurance agent about all aspects of your home and even you personally. You never know when you may qualify for a different discount. Creating a relationship with your insurance agent is a great way to get to know the discounts and even earn loyalty discounts if you stay with the same company long-term.

Home insurance is important as it protects one of the most important investments in your life. Make sure you have adequate coverage, but don’t pay too much. Shopping around for a policy at least every other year will help you ensure that you have the lowest premiums available to you. Using the above tips, you can help decrease your premiums, saving money while protecting your home at the same time.

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