Quick Tips for Lowering Your Home Insurance Premium

The price you pay for homeowners insurance can vary widely, depending on your policy and your policy provider. Consider the following tips as you look for ways to lower your premium.

-Shop Around. Spend time researching different providers. To start with, it may be easiest seek advice from friends and family members. You should also consult your state’s insurance department, which usually displays typical rates that major insurers charge and the frequency of customer complaints. You can also check online quote services to get a better idea of your premium. Consumer guides and insurance agents can give you an idea of price ranges and companies with the lowest prices. Aside from low prices, you also want a stable company. It’s important therefore, to check the financial status of the providers you’re considering, using rating companies like Standard & Poor’s and A.M. Best. Rank your top three insurers, and get price quotes from them.

-Raise Your Deductible. Your deductible is the amount of money you pay out of pocket before an insurance policy will kick in to pay a claim. The more you pay on your deductible, the less you’ll pay for your premium. The premium is paid either monthly, quarterly, or biannually. If you can afford to raise your deductible, say from $500 to $1,000, you would save 25 percent on the amount paid for premiums. For certain disaster-prone areas, like cities along the Gulf Coast, there may be separate policies for wind damage and hurricane disasters. For most insurers, a higher deductible wouldn’t apply if there were damage due to a common regional threat; which is why they set up a separate policy for frequent threats. When you do raise your deductible, make sure you know exactly what your policy will cover in case you have to file a claim.

-Consolidate Your Policies. If you can bundle your auto and homeowner’s insurance with the same company, you may save between 5-15 percent of your premium. Many companies will offer incentives to bundle policies, such as a discount on premiums or a combined deductible. The added benefit of a bundled policy is the convenience of paying only one bill. Nevertheless, if you’re trying to save money, you should compare separate auto and homeowners insurance policies with a bundled policy. You may even find that it’s more cost effective to have separate homeowners and auto coverage.

-Improve Your Home’s Security. Beyond keeping you and your loved ones safe, beefing up your home’s security can actually get dollars shaved off your insurance premium. Simple security enhancements in your house, such as deadbolt locks, smoke detectors, and burglar alarms, can help you save at least 5 percent. For more advanced and expensive home security arrangements, make sure you check with your insurer to find which system they recommend. Typically, sprinkler security systems, burglar alarms that phone the police, and other monitoring devices can cut your premium by 15-20 percent.

-Actively Seek Out Discounts. There are a great number of discounts to be had; you simply have to ask. If you’ve been with the same insurer for a long period of time, you may be eligible for a loyalty discount. If you or someone in your family recently quit smoking, mention it to your insurance agent to see if you can get a discount on your premiums. People over the age of 55 can receive discounts. Many groups, such as AARP, university alumni associations, and employers, partner with insurance companies, and may have a lower group rate than the one you pay as an individual.

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