Do you need home insurance? Yes, if you have a mortgage lender. There are many ways to save money on homeowners insurance and still protect your investment.
It is a smart financial decision to insure the home as well as any valuables inside it. This is even after your mortgage has been paid off. If you don’t have insurance, losing your home to fire could result in you paying hundreds of thousands of dollars. Insurance professionals recommend that homeowners insurance be maintained even if you have paid off your mortgage.
To understand how to save money on your home insurance, you need to balance having enough coverage in the event of a catastrophe and keeping your premiums low. These are ways to lower your home insurance cost.
1. Bundle your insurance policies
Insurance may be offered by more than one provider. Your auto insurance could be with the same company that you were insured with as a young adult, while your life insurance may be with the insurance company your employer uses. Bundling all of your insurance products with one company could save you significant cash. Most insurers will reward loyalty by giving you a multi-policy discount.
Samantha Rheel is a Senior Sales Executive with Coughlin Insurance Services, New York. She agrees that bundling policies can lead to savings.
Rheel states that companies prefer to offer packaged policies over monoline policies and have the best rates. Asking an agent to quote other lines of business can not only help you get better coverage, but it could also result in significant savings.
Ask your agent about the discounts available when you add other policies like life and auto insurance. Combining at least two policies can result in substantial savings.
2. Take a look around
You can do a comparison of your home insurance like you would in a grocery store.
Every insurance company has its own pricing guidelines. Prices can vary depending on your coverage. You can compare home insurance quotes to see how the premiums are calculated and whether you qualify for discounts. You can see the differences in prices from one provider to another, so it is worth comparing several quotes to find out which company offers you the best premium.
Cross-reference your home and home insurance options with to identify companies that offer both.
3. Ask for discounts
Ask your insurance provider about the discounts they offer and whether you are eligible. There are many discounts available, including loyalty discounts and multi-policy discounts as well as discounts for home upgrades.
Rheel states that insurance companies are attracted to responsible homeowners. It’s important to keep up with the maintenance of things such as your roof, heating system, plumbing system and electric.
Rheel suggests also taking preventative measures like installing alarm systems, surveillance cameras, and water shutoff valves.
Rheel states that insurance carriers have been quite creative in terms of the types of discounts and deductions they offer. The better your chances of qualifying for top-tier discounts, the more proactive you are.
Discounts are a great way to reduce your homeowners insurance costs. Here’s a list of the most common discounts:
- Save money by installing smart smoke detectors. You can also get discounts from your homeowner’s insurance provider for installing home security systems.
- Roof discounts: Your home’s roof is an important part of your protection. Premiums can be lower for a newer roof, especially one made with impact-resistant materials.
- Loyalty Discounts: If your insurance company has been in business for a while, and you’re looking to reduce homeowners insurance costs without changing, you can call and inquire if they offer a loyalty discount.
4. Assess your policy and consider increasing your deductible
Are you looking for ways to reduce your home insurance? Have a look at the coverage. You are required to have certain parts of your home insurance, including:
- Protection for damage to the house or other structures like a fence, shed, or other structures
- Protection for personal property
- Additional living expenses in the event that your home becomes uninhabitable because of a covered claim
- Medical payments and liability
Rheel states that these coverages are essential to a homeowner’s contract and should not be altered. It is risky to go without homeowners insurance. However, you don’t have to pay extra for it. Talk to your agent or provider to determine if you have any optional coverages that might be suitable for your needs.
Consider raising your deductible. This is the amount that you pay out-of-pocket for a covered claim. For example, if your deductible is $500 and you have $4,000 in covered claims, then you will be responsible for the first $500 and the insurance company for the remaining $3,500.
Higher deductibles mean you will be responsible for more in case of a claim. However, the higher your deductible, and the lower your premium, means that you will have to pay more. You will be responsible for more money out-of-pocket if you raise your deductible. Before you decide to make a change on your policy, ensure that you are able to afford a higherdeductible.
5. Credit score improvement
A low credit score can mean that you are paying a higher monthly premium unless your home is located in California, Maryland, or Massachusetts.
Laura Adams, an insurance expert, explains:
Home insurers consider you less risky if you have good credit. They may not make many claims if you have no or very few credit scores.
Adams suggests that you follow up with your insurance company if your credit score has increased. Higher credit scores mean you are more likely to pay less.
6. Contact an agent
Agents are not just someone who help you choose insurance but they also help you file a claim with local contractors and fix damages. Your agent might earn a commission depending on what type of coverage they sell.
Experienced agents are familiar with the intricacies of the insurance companies that they represent. They can offer valuable advice and recommendations regarding the type of insurance you might need, or whether you require additional coverage.
Rheel states that you will receive personal service and someone looking out for your best interests. “A good agent will stand up for you in the case of a claim and act as a liaison between you carrier.”
7. Remodel your home
Your insurance provider may reward you with lower home-insurance premiums if you make specific changes. These home updates discounts can be obtained in two ways.
Protect your home against disasters
These are some updates that you can make to your home in order to keep it safer and lower your home insurance premiums.
- Get new roofing: As mentioned, insurance companies offer discounts on storm-proof roofing. In general, older roofs are more likely to be damaged in storms than newer ones.
- Make your home safer by updating your electrical system. Insurers may offer lower premiums if you make improvements to your electrical system.
- Update your plumbing: Lower risk at home means lower home insurance costs. New pipes, which can reduce water damage to your home, can encourage your insurance provider to lower your policy’s cost.
Secure your home
Also, security and safety features can reduce your risk, which could result in homeowners insurance discounts. You might be able save money by installing:
- Smart smoke alarms: Add one to your home and notify your insurance company. Smart smoke alarms are worth considering when you’re comparing alarms. For example, smart smoke alarms can send a notification to your smartphone that alerts you if you’re not at home.
- Fire Sprinklers: These systems are activated to mitigate the effects of a home fire. Sprinkler systems are often discounted by insurance companies to keep claims costs lower.
- Burglar alarms Because your home insurance policy covers theft, some insurers offer discounts for installing burglar alarms.
How to save money on homeowners insurance
There are many ways to save, whether you want to change insurance companies or talk with your agent about the best coverage for you. You don’t have to pay too much for home insurance.
Check your coverage to ensure you have all you need. Ask about discounts and maintain a high credit score.