Saving money in all areas of your finances is a growing trend. With the economy being tough in recent years, most homeowners are pulling out all stops in reducing their monthly bills. Although reducing your mortgage payments may be impossible, finding ways to reduce your homeowner’s insurance premiums is possible and simple to do. Following these tips, you can find hundreds of dollars of savings off your annual homeowner’s policy; remember, this is not a substitution for professional advice you can get with an insurance agent.
1. Know Your Structure
The primary factor is the cost to replace any damages with labor and materials. In addition, aside from flood consideration, the land that your house is on is rarely at risk for damage. When insuring your home, you need to make sure the land’s value is not a factor. When you shop around for homeowner’s insurance, keep this in mind when you quote the value of your home.
2. Increase Your Deductible
The deductible is the amount you are required to pay before the insurance pays for any damage or losses. This is a number from a few hundred dollars to thousands, or in some states, can be a percentage such as 1%. Increasing your deductible will decrease your premiums. Just be sure that you would financially be able to pay the deductible in the event of a disaster.
3. Maintain a Good Credit and Claim Record
Just like your credit, every time you initiate a claim on your insurance, this is noted and kept on record. Multiple claims by a home owner, or multiple claims at a single address can increase your premium for future homeowner’s insurance. Some insurance companies base their rates on your credit history. Maintaining a good credit rating will not only save you money on financing, but also on homeowner’s and auto insurance.
4. Bundle Policies
Shop around and find the best deal for the entire package. If you own two automobiles, a home, condo, boat, motorcycle, rental property, life, etc. have your insurance agent quote you for a bundled policy. The discounts can add up to large savings for some companies for multiple policies.
5. Be Proactive
Making damage-reducing improvements to your home can not only increase the value of your home, but also decrease your insurance premiums. Storm shutters, reinforced roofing shingles, reinforced outer doors, and storm resistant windows are all considerations some insurance companies use to determine a premium.
Being proactive also includes maintaining the security of your home. Since homeowners insurance covers burglary and fire damage, most companies will give discounts for smoke detectors, sprinkler systems, dead bolt locks, intruder alarms, etc. Your distance from the nearest fire department and hydrant is also a factor in determining your premiums.
All of these tips will help reduce your annual premium. The most important tip to reduce your insurance cost is to talk to your insurance agent. Be sure to give the correct information to prevent a discrepancy in your quote and your actual premium.