Many people shop long and hard before choosing insurance policies for their health and car. it’s just as important to compare policies when insuring your home. New home buyers often accept recommendations by a builder, and current homeowners rarely consider shopping for a new insurer. However, with a little research, you could save hundreds of dollars a year on your home insurance.
Actually, you could possibly save without even switching carriers by taking these simple steps:
Try Increasing the Deductible
To reduce home insurance costs, you can carry the highest deductible possible. The higher the deductible, the lower the premium the insurance company will charge you. You could save up to 25% by increasing your deductible from $100 to $1,000. Be sure that you have enough available cash on hand to cover the larger deductible if you decide to do this
Improve Your Home’s Security
Insurance companies typically offer discounts for homes with smoke detectors, burglar alarms, dead bolts, fire extinguishers, and even to those in Neighborhood Watch areas. Alarm systems connected to a third-party monitoring system can receive even higher discounts.
Consolidate Your Policies
Insurance companies are known to give “multiple coverage” discounts by using one company for all of your insurance needs. This is one of the best options to save quite a bit of money. It’s also a good idea to have a good relationship with your agent, and the more policies you hold with him / her the better chance you have to be one of their recognized clients
Verify Distance to Fire Stations
Your premiums will be higher if you live more than five miles from the nearest fire station and more than 1,000 feet from a fire hydrant, as public services cannot respond as quickly to emergencies.
Find out if additional discounts apply for mortgage-free homes. Some insurance companies will offer 5% discounts to homeowners who have paid off their mortgage.
Mortgage lenders require borrowers to carry home owner insurance. But even those who own their homes without a mortgage should be covered. Homeowner policies cover loss or damage to the property as well as personal liability, which covers injuries or illnesses related to your property. Losses under a homeowner’s policy can be paid on actual cash value basis or on a replacement cost basis. With the “actual cash value” method, the policy owner is entitled to the depreciated value of the damaged property. The older the item is, the less money you may receive for its replacement. Under the “replacement cost” coverage model, which typically costs more, the policy owner is reimbursed the amount it costs to actually replace lost or damaged items.
Common Insurance Coverage
The homeowner’s policy is a package that combines more than one type of insurance coverage. Here are four basic types of coverage contained in the homeowner’s policy:
1) Dwelling and Personal Property — For example, if a car plows into your window, your homeowner’s policy should cover damage to the structure.
2) Personal Liability — If someone falls on your front steps, your policy should cover the legal fees if they decide to sue you.
3) Medical Payments — An example here is, if your home has radon, medical treatment for visitors to your home who suffered radon poisoning may be included in your coverage.
4) Additional Living Expenses — If your home becomes uninhabitable, you may be paid expenses for time spent in a hotel.