Based on the insurance company you’re going to purchase your policy from, the price you pay for your homeowners insurance policy can range quite a bit. Therefore, if you plan on getting one soon, but you don’t want to pay top dollar for it, here are some of the best ways you can get great coverage without breaking the bank.
1. Shop Around
It’s true that shopping around is going to take some time, but the truth is that if you’re patient, then it’s going to pay off in the long run. Get in touch with your state insurance department, check the Yellow Pages and don’t forget to ask your friends for recommendations as well. You should also contact NAIC since they can help you choose the best insurer in your area, including complaints. Better yet, the majority of states make the info available on regular charges (rates that are charged by the insurers themselves) and some states can also provide info about the frequency and number of complaints filed by consumers with a specific company.
Don’t forget to also check the internet insurance quote services, insurance companies, insurance agents and consumer guides. By doing so, you’ll get a good idea of the price range and learn more about the companies with the best prices. Speaking of price, it’s not a good idea to guide yourself by price alone. The insurer needs to also be known for delivering high quality services and for its helpfulness when it comes to dealing with consumer complaints. Just make sure to talk to several insurance companies to get a feel for the kind of service they provide and inquire them about the things they could do to keep your costs low.
Use companies such as Standard and Poors and A.M Best in order to check the financial stability of the insurance company you plan on using. After you’ll have your choices narrowed down to just 3, it’s time to get some price quotes.
2. Increase Your Deductible
Deductibles are basically the amount of money you are going to pay towards a loss before your insurer covers your claim, based on your policy’s terms and conditions. The good news is that if you have a high deductible, then you’re going to pay a lower monthly premium. These days, the majority of insurers recommend clients to get a deductible of at least five hundred dollars. However, if you manage to increase your deductible to one thousand dollars, then you’ll save up to twenty five percent on your insurance premium.
Keep in mind that individuals living in areas that are prone to disasters, your insurance policy may come with a special and separate deductible for different types of damage. For instance, if you live in an earthquake prone area, your earthquake policy is going to come with a deductible and the same applies if you live in an area vulnerable to hail storms or on the coast in the East (which is prone to windstorms).
3. Rebuilding costs shouldn’t be confused with what you’ve paid for your house
Because the land under your property is not at risk from fire, windstorm, theft and similar perils, you should not include its value in your homeowners policy. Doing so means you’re going to pay a much higher premium for nothing.
4. Purchase your car and home insurance policy from the same insurance company
Companies that sell liability, car and homeowners coverage are going to take between five to fifteen percent off your monthly premium if you purchase at least two policies from them. Just make sure that the final price you get is lower than purchasing the various types of coverage from separate companies.
5. If you’re in a government plan, look for private insurance
If you live in an area that’s prone to crime, fires or coastal storms and used a government plan to purchase your homeowners insurance, you may want to speak to a company representative or insurance agent or get in touch with the state department of insurance and start looking for companies that may be interested in your business. By doing so, there’s a good chance you could be able to purchase insurance at a much lower price by getting it from the private market.
6. Make your property more resistant to various types of disasters
Talk to your insurance company or agent in order to learn more about the things you can do in order to increase your home’s resistance to the various types of natural disasters, including windstorms, earthquakes and so on. By purchasing stronger roofing materials, reinforcing your roof and adding storm shutters, you can save a good amount of money on your monthly premium. If you have an older home, then don’t worry, since you can easily retrofit it so it can easily withstand earthquakes. On top of that, you may also want to consider modernizing your electrical, plumbing and heating systems in order to minimize the risk of water and fire damage.
7. Review the value of your possessions and the limits in your policy at least once a year
Your policy needs to cover any major additions or purchases for your property, yet spending money for coverage you don’t require is not a good idea. For instance, if you have a rug that cost $3,000, but it’s now worth a lot less than that, you may want to cancel your floater (which represents added insurance for items that your homeowner policy doesn’t cover, including art work, top of the line computers, jewelry) and pocket the difference.
8. Improve your home security
If you install deadbolt locks, a burglar alarm or a smoke detector, then you’re going to get a 5% discount on your premium. However, if you decide to install a state of the art sprinkler system or a burglar and fire alarm that rings the fire services and the police, then a number of companies could offer you discounts that range between fifteen and twenty percent. It’s true that these systems are on the expensive side and not every property is going to be eligible for a discount. Prior to purchasing one such system, it’s best to speak to your insurance company about the best ones it prefers, its price and the amount of money you’ll save on your monthly premium.
9. Maintain a good credit record
One way to reduce your insurance costs is to maintain a great credit history. Credit information is used by more and more insurance companies for the purpose of pricing homeowners insurance policies. In general, the insurance company needs to inform you of any adverse action, including higher rates and it’s at this time that you need to check the accuracy of the info on which the company relied. If you want your credit history to be excellent, then you need never get more credit than you required, ensure your credit balance is as low as it can be and also pay your bills on time. You should also regularly check your credit score and if you find any errors, dispute them right away.
10. Start looking for other discounts
There are several kinds of discounts that insurers offer, but not all of them offer the same discount amount or the same type of discount in all states. For instance, since retired individuals spend more time at home compared to people who have a job, there’s a higher chance that they’ll spot potential fires and a lower chance that someone may burglarize them. If you’re retired and are at least fifty five years old, then some companies may provide you discounts of up to ten percent. Better yet, some professional associations and employers can provide group insurance programs that can get you a much better deal than what you could find somewhere else.
11. Take the cost of homeowners insurance into consideration when purchasing a home
If you purchase a home in an area that has a professional fire department or near a fire hydrant, you may need to pay less for your insurance premium. The price can also be lower if your home’s plumbing, heating and electrical systems are less than ten years old. If you live in the East, then it’s recommended to go for a home that’s made of bricks, since it has a much higher wind resistance. If you live in an area that’s prone to earthquakes, get a home that’s made of wood and you’ll realize that you can cut the cost of your premium by five and up to fifteen percent.
Prior to buying your new home, check the CLUE report since it contains data about the property’s insurance claim history.
If you have any questions about insuring any type of possessions, make sure to speak to the representative of each insurance company you may want to buy an insurance policy from. For instance, if you’re running an out-of-home business, don’t forget to talk about the right coverage for that specific type of business. The majority of homeowners policies will cover business equipment in your house, but there’s a limit of twenty five hundred dollars for that and they also offer no business liability insurance. Even though you want to reduce the cost of your homeowners insurance, you shouldn’t do that at the expense of getting less coverage than what you actually need.
View the Coastal Insurance Video Library to find helpful video’s explaining everything from, how to save money on Homeowners Insurance to an easy explanation of Flood Insurance. Call today (631-782-3175) to speak with one of our underwriting experts. Fast Quotes, A.M. Best Rates & Free Advice.