Homeowner’s pay an average of $962 per year for homeowner’s insurance. While home insurance is vital to protect yourself against theft, fire, storms, and natural disaster, you probably want to pay as little as possible for the coverage you need. Dozens of factors go into determining your home insurance rates, including the size and type of your home, your geographic location, your credit score, your lifestyle habits, and more. Here are 10 easy ways to reduce your homeowner’s insurance premiums by addressing major factors that influence rates and ensuring your policy fits your needs.
Improve your home security
Homeowner’s insurance protects against many risks, not just fire, flood, and storm damage. An easy way to reduce your homeowner’s insurance premiums is improving your home security against fire and theft. Consider adding burglar alarms, deadbolt locks, and hard-wired smoke detectors to qualify for discounts from your insurance company. Depending on the home security upgrades you choose, you may qualify for a discount of 5% to 20%. It’s a good idea to check if the upgrade qualifies for a discount with your insurer first and compare the cost of the device with what you can save on home insurance.
Think twice about your dog breed
While many homeowners do not think about their dog when it comes to homeowner’s insurance, the fact is dog bites are the most common liability claim on homeowner’s policies, accounting for more than one-third of liability claims. Depending on your dog breed, your homeowner’s insurance company may exclude your dog from liability coverage, raise your premium, or deny coverage completely.
Some dog breeds are more likely to raise your home insurance rates more than others. High-risk dog breeds include Akitas, Rottweilers, Pit Bull Terriers, German Shepherds, Chows, and Doberman Pinschers.
Increase your deductible
The most surefire way to save on home insurance is raising your deductible, which is the amount you need to pay out-of-pocket when you make a claim. The higher your deductible, the greater your savings. Still, it’s important to make sure your deductible is still affordable if you need to make a claim. Choose a deductible amount you can afford in a disaster. Most insurance companies recommend a deductible of at least $500, but you can save up to 25% by increasing your deductible to $1,000.
Exclude your land value
Homeowner’s insurance is designed to help you rebuild or repair your home if it suffers a covered peril like flood, fire, theft, or hail damage. What many homeowners do not realize is the value of their land is also included in their policy. Don’t mix up the purchase price of your home (which included land value) with the cost to rebuild. After all, your land is not at risk of being destroyed by fire or theft. If your land value is included, you may be paying higher home insurance premiums than necessary.
Improve your credit score
Think your credit score has no effect on your insurance rates? Think again. Your credit is one of many factors insurance companies use to determine your home insurance premiums. This is because insurance companies have found policyholders with poor credit often make more claims than consumers with great credit. There are several steps you can take to improve your credit, including paying bills on time, checking your credit reports regularly and correcting harmful errors, and maintaining low balances on credit cards.
Check your policy limits
It’s a good idea to review your homeowner’s policy every year to check your policy limits against the value of your possessions. Your policy should cover major purchases and additions, but you don’t want to pay more for coverage for items that have fallen in value. It may be worthwhile to reduce or cancel floaters and endorsements for items that you no longer own or have declined in value like jewelry, furs, and electronics.
Ask about your insurer’s discounts
Every insurance company offers their own discounts, but don’t expect every discount to be highly advertised. Some companies may offer a discount for recent plumbing or electrical replacement, for example, or a discount if you are at least 55 and retired. Some insurance companies even offer discounts for teachers and those who work in the public service sector like firefighters, police officers, and correctional officers.
Bundle your policy
You can get a discount of 15% to 30% by simply bundling your policies and buying homeowner’s, auto, and/or life insurance from the same insurance company. While the discount may be significant, don’t forget to compare quotes from other insurance companies to make sure you’re actually getting the right policy at the best price.
Every year, smoking causes more than 90,000 home fires that lead to $621 million in direct property damage. Smoking is the leading cause of home fires in the United States, according to the National Fire Protection Association. Insurance companies understand the risks that smoking can pose and many now offer a discount on homeowner’s insurance for non-smokers. You can save up to 20% on home insurance by quitting for good.
Don’t assume your insurance company will reward you for your loyalty with the lowest homeowner’s insurance rates possible. The single-best way to save on homeowner’s insurance is to compare quotes from many insurers every few years. Discounts and rates vary a great deal from one insurance company to the next. You may want to start by asking your agent if you can get a better rate on your current policy. As you compare quotes, be sure to check how they compare to your current policy to make sure you know what you are getting.
These ten ways to lower homeowner’s insurance premiums can save you hundreds, all without sacrificing the coverage you need for your home and belongings. As a general rule, it’s a good idea to periodically review your policy to make sure you aren’t paying for coverage you don’t need and get quotes from other insurance companies at least every year or two.
See also: Compare Homeowner’s Insurance Rates