You may be able to lower your homeowner insurance costs by looking for discounts, reducing the risk of making an insurance claim and choosing the right provider for your homeowner insurance needs. This review discusses ways to lower your homeowner insurance monthly premium cost.
What Factors Affect the Cost of My Homeowner Insurance Policy?
There are many factors that affect the cost of a homeowner insurance policy. It is important to understand your deductible costs and limits and weigh them against your premium to determine if you have a fair rate. However, three of the main factors that influence the cost of your policy are the type of coverage, the location of the home and the age of the home.
Type of Coverage
The type (and extent) of coverage is a major factor in how much the insurance provider charges. Common types of coverage options that may be included in your policy include:
- Dwelling coverage
- Other structures
- Loss of use (ALE)
- Personal property
Keep in mind, flood and earthquake coverage is not included in homeowner insurance policies, so you may need to purchase this separately. Be sure to speak with your insurance agent about what your policy currently covers.
The location of your home also plays a role in the cost of your policy. If you live in an area that is more susceptible to floods or hurricanes (i.e. properties near the ocean), then you may pay a higher premium for homeowner insurance. On the other hand, properties that do not typically experience bad weather often have lower premiums on average.
The older a home is more likely to have issues needing repair. This is not necessarily measured by the year the home was first built but rather the last time the home was properly renovated. For example, a home with an old roof and plumbing system is likely to cost more to insure.
How to Lower Your Homeowner Insurance Cost
You should discuss ways to lower your homeowner insurance cost with your provider. If you feel they are not offering a fair price, then be sure to shop from other insurance providers to ensure you get the best rate possible for your insurance needs. Several general ways you may be able to lower your homeowner insurance costs include increasing your deductible, searching for discounts, reducing insurance claim risks and finding the right provider.
Increase Your Deductible
The deductible is the amount you pay to access your insurance coverage. For example, let’s say your home is broken into and you make a claim to replace the cost of the stolen property. In this instance, you pay the deductible and the rest is covered by the insurance provider. The higher your deductible cost, the lower your homeowner insurance premium (the amount you pay monthly) is likely to be.
Search for Discounts
Homeowner insurance providers often offer discounts as incentives for certain actions. For example, if your provider offers both home and auto insurance, then you may be able to receive a discount for purchasing both policies. You may also receive a discount if you pay your annual premium in full rather than monthly. The discounts vary for each provider, so be sure to discuss with your insurance agent about the possible discounts you may be able to receive to lower your homeowner insurance costs.
Reduce the Risk of Insurance Claims
Discuss with your insurance provider the types of discounts they offer for a reduction in the risk of making a claim. Several ways you may be able to lower your cost by reducing the risk of insurance claims include:
- Install a security system
- Upgrade your roof
- Install storm shutters
- Make your home fire-resistant
If you take precautions to lower your risk of making an insurance claim, then your insurance provider may reward you with a lower rate. The discount options vary for each provider.
Stick with the Same Provider Long-Term
After you find the right insurance provider for your needs, plan to stick with them long-term. This builds trust, and you may be eligible for lower rates over time. Of course, you do not want to remain with a provider that does not offer a fair price and quality coverage, but sticking with the right insurance provider is a great way to lower your homeowner insurance costs over time.
Speak with a Homeowner Insurance Agent Today
If you are unhappy with your current homeowner insurance policy or are currently without a policy, then contact Merchant Family Agency today. We can personalize your insurance plan to ensure you have the coverage you need at a fair cost. At Merchant Family Agency, we take pride in helping our policyholders feel secure, knowing they are receiving great coverage at a highly competitive rate.