Home insurance premiums can vary widely even within the same zip code, so you’ll have to do some comparison shopping to find cheap home insurance that can provide adequate coverage for your needs. The wide discrepancy in home insurance premiums is due to a number of factors including location, the construction of your house, the crime rate in your area and even if you’re a smoker or dog owner.
Every insurance carrier analyzes risk factors differently and offers their own unique set of discounts, so be sure to inquire about all the savings you can get. Whatever your circumstances are, there are sways you can lower your home insurance premiums without compromising quality coverage.
Don’t Over Insure
You can insure your home at a replacement cost or market value cost. At the very least, your home should be insured for its estimated total replacement cost. Market value coverage includes the value of the land the house is sitting on but most homeowners will not need this coverage as rebuilding a house would rarely cost more than its purchase price. Get an estimate on rebuilding costs through a local contractor instead of relying solely on an estimate provided by your insurance agent.
Raise your deductible
Deductibles can range from $500 to $10,000. Raising your deductible to lower your home insurance premiums will help you find significant savings, but be sure you have enough to pay out of pocket for repairs or mishaps that will cost less than the amount before your coverage kicks in. If you don’t have one already, start building an emergency fund to pay your higher deductible in the event that you have to make a claim.
Keep A Good Credit Score
Insurance companies will use your credit history to determine how likely you’ll repay your debt on time. Therefore make sure you maintain a healthy debt to credit limit ratio and continue to pay your bills on time. Also make sure to review your credit report every year to make sure it’s accurate.
Bundle Your Insurance Policies
You can get up to a 15% discount with some insurers depending on which state you live in. You may also get discounts by staying with the same insurer for a long time.
Search For More Discounts
There are many other discounts in addition to bundling your insurance policies. Ask for a full list of discounts with each company when you shop for a quote. You can get discounts that are related to your home including how eco-friendly, secure or disaster-resistant it is. Discounts may also be available to individuals who are senior citizens, non-smokers, married or claims-free.
Finding Savings & Discounts
Start your comparison shopping for home insurance by looking at an insurer’s ratings at Moody’s, Standard & Poor’s or A.M. Best. You can also look up insurers in your state and customer complaints at your state insurance department here.
One insurance company to consider is USAA’s Property and Casualty Insurance Group as it consistently receives strong financial ratings and customer satisfaction. USAA offers discounts for bundling your insurance policies and installing ADT home security devices. USAA is only available to active or retired military members, their parents or children, as well as widows of former USAA members who had USAA insurance while married.
Liberty Mutual is the third largest property and casualty insurance company and also has strong financial ratings. Liberty Mutual also provides several discounts for having a claims-free record, insuring against inflation, holding multiple insurance policies, closing your home purchase within 60 days of the policy effective date and installing protective devices in your home such as smoke alarms and deadbolts. Homes with recent renovations or are less than 13 years old will also get you a discount. You should also check if your employer, alumni or other association is partnered with Liberty Mutual to give you exclusive group discounts.
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