How To Save On Homeowners Insurance

Raise Your Deductible

Deductibles are the amount of money you have to pay toward a loss before your insurance company starts to pay a claim.  The higher your deductible, the more money you can save on your premiums.  Most insurance companies recommend a deductible of at least $500.  If you can afford to raise your deductible to $1,000, you may save as much as 25%.  Remember, your insurance policy may have a separate deductible for certain kinds of damage such as hurricane and windstorm.

Don't Confuse What You Paid For Your House With Rebuilding Costs

Your homeowners policy is based on the cost to rebuild your home, not its real estate value.  While your house may be at risk from theft, windstorm, fire and other perils, the land it sits on is not, so don't include its value in deciding how much homeowners insurance to buy.  If you do, you'll pay a higher premium than you should.

Seek Out Other Discounts

Wind mitigation discount is the largest discount a homeowner can get and it largely depends on the year of the roof in comparison to the age of the home.  For example, if the roof is newer than 2004 and the home is older then 2002, you can get discounts on the wind portion of the premium.  Also, retired people also have more time for maintaining their homes.  If you are at least 55 years old and retired, you may qualify for a discount of up to 10% at some companies.

Make Your Home More Disaster Resistant

Find out from your insurance agent what steps you can take to make your home more resistant to windstorms and other natural disasters.  You may be able to save on your premiums by adding storm shutters or buying stronger roofing materials.  In addition, consider updating your heating, plumbing and electrical systems to reduce the risk of fire and water damage.

Improve Your Home Security

You can usually get discounts of at least 5% for a smoke detector, burglar alarm or dead-bolt locks.  Some companies offer to cut your premium by as much as 15% to 20% if you install a sophisticated sprinkler system and a fire and burglar alarm that rings at the police, fire or other monitoring stations.  These systems are not cheap and not every system qualifies for a discount.  Before you buy such a system, find out what kind your insurer recommends, how much the device would cost and how much you will save on premiums.

Maintain A Good Credit Record

Establishing an excellent credit history can cut your insurance costs.  Insurers are increasingly using credit information to price homeowners insurance policies.  To protect your credit standing, pay your bills on time, do not obtain more credit than you need and keep your credit balances as low as possible.

Review The Limits In Your Policy And The Value Of Your Possessions

You want your policy to cover any major purchases or additions to your home, but you do not want to spend money for coverage you do not need.  If your six year old fur coat is no longer worth the $3,000 you paid for it, you will want to reduce or cancel your floater (extra insurance for items whose full value is not covered by standard homeowners policies such as expensive jewelry, high-end computers and valuable art work) and pocket the difference.

Source: Sihle Insurance Group

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