Reducing Your Homeowner Insurance Costs

Insurance companies determine risk for homeowners insurance by weighing factors such as the type of home (some newer homes have safer materials) and the area in which a home is located, to name a few. Read the following information to learn more about factors that affect your homeowners insurance costs.

Money saving discounts

Insurance companies often offer a number of special credits to help cut the cost of insurance because their customers have done something to reduce their risk. In some cases, these credits are a way to reward valuable customers for their loyalty and continued business. These credits are described in general terms.

Homeowners association credit: Homes located in eligible homeowners associations may qualify for a credit. This is because homeowners in an association are likely to have a stronger sense of community and tend to watch out for one another. That means you’ve lowered your risk.

Mature insured credit: If you and/or your spouse is retired, you could receive a credit on your policy. That’s because retired people are likely to be home more often and may be able to prevent trouble — like smelling an unusual odor from the furnace and shutting it off before it backfires soot into the home

Multi-policy credit: You can save money if you have more than one type of policy with the same insurance company (for example, an auto and homeowners policy). The more good business you give the company, the more valuable you are as a customer.

Newer home credit: The age of your home may qualify you for savings because plumbing, heating, and electrical systems of newer homes have lower risks than outdated systems.

Nonsmoker’s credit: Studies show that homes inhabited by nonsmokers have a lower chance of having a fire. Your reduced risk may mean a reduced premium.

Protective device credit: If your home has certain types of fire alarms, burglar alarms, locks, or smoke detectors, you’ve reduced your risk and may qualify for this credit.

Renewal or long-term customer credits: You could get credit when you renew your policy, beginning with the first renewal or after you’ve been a policyholder for a designated number of years. (It’s the good customer thing again!)

Deductibles: Ordinarily, the deductible amount (what you pay out of your own pocket before your insurance policy kicks in) on a homeowners policy is $250. By choosing a higher deductible ($500, $750, $1,000 or higher), you’ll have lower annual premium payments. Have you insured your land? Sometimes the value of your land is incorrectly included as part of your dwelling coverage (also called Coverage A). Since homeowners policies don’t provide protection for your land, it would be a waste of money to include its value as part of your Coverage A amount. Your Coverage A amount should only reflect the price it would cost to repair or replace your home’s structure. If you aren’t sure whether your land is also included, contact us so we can review your policy.