Let’s face it, knowing that your home is one of the biggest investments you’ll ever make, you’ll pump more money into it than anything else. It sure would be nice to be able to save as much money as possible however you can on your home. When it comes to homeowner’s insurance, there are some steps you can take and places you can look that can really save you some money. Wouldn’t that be nice for a change?
Step 1 Do some shopping around. Don’t just assume that the insurance company you’ve always had has the best rates. Don’t assume that the insurance company your parents always used or your best friend uses is the best either. Be sure to get quotes from at least three insurance companies.
Step 2 Raise your deductible. The deductible is the amount of money you would pay, out of pocket, on a loss before the insurance company will begin paying (assuming it is a covered loss). The higher your deductible, the less your insurance premium will be. Just be sure not to get yourself in a bind here. Make sure you have the deductible amount available (in savings or some other place) so you aren’t put into a bind in case of an unexpected loss.
Step 3 Take measures against theft and/or break-ins. Insurance companies typically offer discounts on homeowner’s policies when a burglar or security alarm system is installed. This can be up to 10% off. So even if there is some initial cost involved, it can easily pay for itself in a short time.
In addition you may also receive discounts for things like installing dead bolt locks or being a part of a neighborhood watch association. It’s definitely worth checking into.
Step 4 Check on discounts. Discounts may be available for any number of things. Safety features like automatic sprinkler systems or centralized fire alarms or security alarms (see Step 3 above) or fire extinguishers can provide discounts that would pay for themselves over time.
Discounts are frequently available if you have multiple policies with the same company. In other words, an insurance company may give you better rates if you also insure your car, boat, life, and/or health with them.
Lower rates are also often provided if you are at least 55 years old and retired, are a member of certain associations or groups (alumni, business, professional, etc.), have been with the same company for a number of years, or have gone a certain length of time without having made a claim against your policy. Remember to ask
Step 5 Insure the house and not the land. Your home is what is at risk for damage or loss and what you are buying the insurance for in the first place. There is no need to insure the land itself. After all, even in the event of a total loss (home burns down or is blown away by a tornado), you still have your land in tact. When deciding the amount of coverage needed, do not include the cost of the land.
