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1.
SHOP AROUND
When looking for homeowners insurance, use the many resources available to
you. You’ll find valuable information through magazine articles in
addition to friends, family, the phone book and Internet. It’s best to
collect a wide range of prices from a number of different companies. In
addition to a fair price, the insurance companies you select also should
offer high-quality service. While this outstanding service might come with
a
higher cost, it is important to be
associated with an insurance company with a well-respected reputation,
especially in the instances when you need to make a claim. To obtain a
full understanding of the types of services these companies offer, have
conversations with a few of their insurance representatives. Find
out from them what they would do to lower your costs. Research the
companies’ financial ratings with AM Best or Standard and Poor's.
2.
RAISE YOUR DEDUCTIBLE
The
insurance company will pay toward your loss after you have paid the
deductible amount as required in your policy. Deductibles on homeowner
policies start at $250. Increase your deductible to
$ 500 -- save up to 12 percent
$1,000 -- save up to 24 percent
$2,500 -- save up to 30 percent
$5,000 -- save up to 37 percent
The
maximum deductible required by mortgage companies is 1% on homeowner
insurance policies.
3.
TWO IN ONE
Buy
your home and auto policies from the same insurer. You can possibly save
5 to 15 percent off of your premium by purchasing two or more policies
from a company that sells homeowners, auto and liability coverage.
4.
NEW OR OLD, EVERYWHERE YOU GO: CONSTRUCTION MATTERS
Consider the cost of insuring the home you wish to buy. The overall
structure along with the electrical, heating and plumbing systems of a new
home are likely to be in better shape than those of an older house.
Because of this, buyers of a new home
may receive an 8 to 15 percent discount from their insurers. You also save
money by buying a home that is not in the 100-year flood plain.
Flood-related damage is not covered by homeowners insurance but by
separate flood insurance.
5.
INSURE YOUR HOUSE, NOT THE LAND
Since the land under your house is not at risk from theft, windstorm, fire
and the other hazards covered in your homeowners policy, you do not want
to include its value while determining the amount of homeowners insurance
to buy. This inclusion will result in a higher premium.
6.
IMPROVE YOUR HOME SECURITY AND SAFETY
Installing a smoke detector, burglar alarm or dead-bolt locks can
typically result at least a 5 percent premium discount. Premiums can be
cut by 15 to 20 percent with the installation of an advanced sprinkler
system and a fire and burglar alarm that notifies the police station or
another security service. This discount does not apply to every system,
and they tend to be costly, so be sure to conduct research before
purchasing these security measures. Before investing in these systems,
ask your insurer which systems are recommended and the savings impact
these would have on your premiums.
7.
NO SMOKING
Smoking is the cause of more than 23,000 residential fires annually.
Reduced premiums are offered to policyholders by some insurers if no
inhabitants smoke.
8.
IT COMES WITH AGE
Typically, individuals who are retired have more time at home and
therefore are more quickly able to deal with hazards to the home, such as
fires. With more time available to maintain the home, a 10 percent
discount on your premium may be available to you if you're at least 55
years old and retired.
9.
THE MORE, THE MERRIER
Insurance companies and alumni and business associations often collaborate
on an insurance package that includes a discount for association members.
Find out from your association's director if there is a discount on
homeowners insurance offered to you.
10.
BE TRUE TO YOUR SCHOOL
Special consideration may be given to you if you've kept your coverage
with one particular company over several years. If you remain with the
same insurance provider for 3 to 5 years, your premium could be reduced by
5 percent; you may be able to save up to 10 percent if you stay with the
same insurance company for 6 years or more.
11.
ANNUAL REVIEW
Compare the limits in your policy to the value of your possessions at
least once a year. You want any major purchases, changes, or additions to
your home to be covered in your policy. However, there’s no need to pay
more money for unneeded coverage.
12.
HAVE “PRIVATE” THOUGHTS
It would be beneficial to talk with an insurance agent or company
representative if you live in a high-risk area that is especially
vulnerable to coastal storms, fires, or crime and have been buying your
homeowners insurance through a government plan. A lower price may be
available to you in the private market and may require only a few easy
steps.
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