Homeowners Insurance (Part 1/4) - Saving Money!

Real Estate

One need look further than the nightly news to understand how important homeowner’s insurance can be to help a homeowner recover in a time of disaster.  From fires to windstorms, floods, & fallen trees, a plethora of calamities can strike at any moment without notice.  So, it’s vitally important that you purchase and maintain insurance for your home.  

While you may have shopped long and hard before settling on insurance policies for health and car, you should compare prices just as carefully when insuring your home. New buyers often accept the insurer recommended by the builder, and current homeowners rarely consider shopping for a new carrier. But with a little research, you could save hundreds of dollars a year on home insurance. In fact, you may be able to save without even switching carriers by taking these simple steps:

- Increase your deductible. To reduce insurance costs, carry the highest deductible possible. The higher the deductible, the lower the premium the insurance company will charge you. Your savings could reach 25% by increasing the deductible from $100 to $1,000. Just make sure you have enough available cash on hand to cover the larger deductible.

- Improve home security. Most insurance companies offer discounts for homes with smoke detectors, burglar alarms, dead bolts, fire extinguishers, and to those in Neighborhood Watch areas. Alarm systems connected to a third-party monitoring system earn even higher discounts.

- Consolidate policies. You can receive “multiple coverage” discounts by using one carrier for all of your insurance needs.

- Verify distance to fire stations and windstorm areas. Your premiums will be higher if you live more than five miles from the nearest fire station and more than 1,000 feet from a fire hydrant, as public services cannot respond as quickly to emergencies. Something else to consider is whether the home is in a hurricane-prone area. If so, reduce premiums by installing approved hurricane shutters.

- Check for available record and renewal discounts. If you go without a claim for three to five years, you may be eligible for a 15% discount. And most companies that service a policy for three consecutive years offer a discount based on longevity of service.

- Find out if additional discounts apply for mortgage-free homes. Some insurance companies offer 5% discounts to people who have paid off their mortgage.

- See if new and renovated homes qualify for additional discounts. You may qualify for discounts if your home was built or rebuilt within the past 10-15 years.

- Investigate additional incentives, including the availability of non-smoker discounts, early retirement incentives, and discounts for homeowners with live-in housekeepers.
Of course, you should check with a professional licensed in your specific location for specifics about the insurance coverage you need. Hopefully these tips will help you get the best bang for your buck when it comes to insurance for your home!