Taking advantage of lesser-known discounts and other creative approaches can help you save money right away.
Although home insurance is rarely the focus of attention, it could be costing you more than you should if you are a homeowner.
Good news: Insurers offer relatively simple-to-obtain incentives to help homeowners lower their insurance premiums.
Here are nine ways you can save.
Raise your deductible
A quick way to reduce your premium is to raise your insurance deductible, the amount you pay if you have to make a claim. According to Mark Friedlander, spokesperson of the Insurance Information Institute, an increase in your deductible from $500 to $1,000 could help you save up 20%.
Your deductible increases your ability to keep money in your pocket instead of paying your insurance. If you do have to file a claim, make sure you have enough money to cover the larger out-of-pocket expenses.
Secure your home
Home security can be as simple as the basics.
Friedlander says that a smoke detector and burglar alarm can save you up to 5%. Friedlander says that adding a sprinkler system to your home, in addition to an active monitored fire alarm and burglar alarm, could help you save as much as 15%-20%.
Avoid small claims
Although it may seem tempting to file a claim with an insurer even if something minor occurs, you might be better off if you pay out-of-pocket for the smaller expenses. This is because many insurers offer discounts for being claim-free for a set period, typically a few years.
Ask about less-known discounts
You may not know the other savings that you could be eligible for unless you do your research. If you are eligible for additional discounts, some insurers may offer them:
- Smokers are not allowed in your home.
- You recently bought your house.
- You can pay your premium by automatic bank payments.
- Paperless billing is your best option
- You may work in one of the following careers: teaching, engineering, firefighting, etc.
Home improvements should be planned
You may be eligible for homeowners insurance discounts if you have improved your home. Insurance savings can be achieved by adding features like storm shutters or impact-resistant roofing, which will make your home more resistant to damage. Upgrading your plumbing and electrical systems could also result in a discount.
Jessica Hanna, spokesperson of the American Property Casualty Insurance Association, says that you can request a new inspection to assess these improvements and maximize your discounts.
Are you worried about who will be visiting your house during the pandemic? Hanna says that most insurers offer virtual inspections.
Bundle your home and auto insurance
Bundling auto and home insurance with the same company typically saves you 5% to 15% on your homeowners premium, according to data from the Insurance Information Institute. While it may vary depending on the company you work for, most insurers offer discounts to customers who buy multiple types of policies.
Credit score improvement
Your credit score can have a significant impact on your home-insurance premium, it may surprise you. That’s because in many states, companies can use a credit-based insurance score to determine your rates. Your rates may be higher if your insurer considers that your credit score is too low, such as a FICO score below 630.
You can improve your credit score by carefully reviewing your credit reports. By paying your bills on time, and reducing credit card debts, you can improve your score.
Get rid of high-risk items
Although it might be enjoyable, your homeowner’s insurance premium could increase if you have something that is considered an “attractive nuisance”. This includes trampolines, swimming pool equipment, or playground equipment. You could save a lot of money by getting rid of these items.
Take a look around
Different companies may have different rates for homeowners insurance coverage. NerdWallet research has shown that homeowners can save up to $1,000 per year by getting the lowest rate.
Most companies have tools on their websites that allow you to plug in some basic information and get quick home insurance quotes. Compare rates from different companies to see if there are any savings.