10 Simple Ways to Cut Your Home Insurance Premium
We all want to pay less for anything, especially the big stuff that keeps costing more every year, like home insurance premiums.
There's just no way to keep around having to buy home insurance, unless you just hit the lottery and don't care about money anymore.
For the rest of us mortals keeping our cost of home ownership low can be a challenge.
If you follow these simple suggestions you might be able to lower your cost of home insurance premiums by 20%, 30% or even 50%.
Let's look at a top 10 list of ways to save on home insurance premiums
1. Deductible – consider an increase in your deductible or taking more financial responsibility will reduce your premium. Anytime you take on more financial burden for any home claims, on your property, you are sharing in the risk which gives you a lower premium.
2. Age of roof - roof damage due to wind and hail is one of the more common home insurance claims. A newer roof will have a longer life and provide more protection. Because roof claims can cost a substantial amount of money, home insurance companies will give better rates for homes with newer roofs.
3. Age of home - newer homes have newer wiring plumbing and other internal structures not subject to claims due to wear and tear. Older homes with aluminum wiring or steal plumbing stacks are more susceptible to breaking, leaking or catching fire.
4. Multi-policy - having more than one insurance policy with any insurance carrier will give you a better rate. Insurance companies understand that by having more than one policy will reduce the likelihood of you leaving and will provide additional discounts for that type of business.
But, in some cases, you might be better served to split your business home insurance and auto with two different carriers. Talk to your insurance broker who represents multiple insurance companies for the best option.
5. Credit - credit is used today in almost all aspects to determine risk concerning insurance. The theory behind credit is if you have an excellent credit rating you're more likely to be a safe driver an maintain your home better then someone with poor credit.
Statistically, insurance companies have analyzed this information over many years and found it to be a very reliable predictor of insurance losses and potential claims.
6. Where you live - State, city, town and even zip code. Where you live matters, depending on the number of policies or saturation of policies and insurance company as in any one area may determine if the premium is going to be higher or lower than the average in your city.
Also because of potential natural disasters an insurance company may not have an appetite or interest in insuring properties in a particular areas. Homes near potential forest fires or even potential brush fires.
States like Florida are subject to hurricanes and flooding make that state unappealing to all National Insurance carriers and generally limited to smaller regional home insurance companies.
7. Pay in full - anytime a business can get paid in full versus taking monthly payments is a win-win. The reduced risk of waiting every month for payment or the additional cost to monthly process payments is an incentive for the home insurance company to give you a discount if you pay your policy in full.
Because most people have a home mortgage which pays the policy and full the best majority up homeowners can take advantage of this discount.
If you are not able to pay your home insurance payment in full ask about automatic EFT or ACH payments taken out every month automatically. Electronic transfer payments will have a reduced monthly fee but still not as low as if the policy was paid-in-full.
8. Alarm monitored - having a home monitored by a security company for fire and theft can save you between 5% and 15% on your home insurance premium. Even a local alarm that does not communicate with a monitoring service will still provide a small discount that sounds an alarm to notify your neighbors of a potential intruder. You will most likely need to show proof of installation and monitoring to receive or continue with the discount.
9. Prior claims - having a clean previous loss History report or no prior claims shows the home insurance company that the likelihood of a future claim is much lower then someone that has had one or two previous claims.
Always make sure to discuss filing a new claim with your insurance representative especially small claims as these can have a significant impact on your ability to find or obtain insurance at a reasonable premium.
Someone with 2 or more prior claims may find it next to impossible to find an insurance company willing to take them as a customer and would most likely be dropped from their current insurance company.
Shopping for Lower Home Insurance Premiums
10. Shop around - if it's been more than two years since your last renewal it would be a good time to contact 2 or 3 insurance companies or a local Home Insurance Broker.
The advantage of working with a home insurance broker is they can shop multiple insurance companies for affordable premiums and excellent coverage to meet your needs.