Tips to Save on Homeowners Insurance
Buying a home is one of the biggest financial transactions the average person is likely to make, but the cost of home ownership extends beyond the sale price of a property. Homeowners that take on mortgages are typically required to carry homeowners insurance and those without mortgages usually choose to buy insurance to protect the value of their homes. There are several simple ways to potentially save on the cost of insuring a home.
Other People Are Reading
-
Comparison Shop
-
Insurance is a product like any other. Shop around when you look for insurance by getting quotes from several different companies and comparing the costs and features of each policy. Even if you've carried homeowners insurance for years, you might benefit from switching a new policy with a different carrier.
Increase Deductibles
-
A deductible is a cost you have to pay toward damages and expenses covered by your insurance plan before your insurance company will pay you. For example, if your homeowners insurance policy has a $250 deductible and a fallen tree causes $2,000 in damage to your home, you have to pay $250 and the insurance company will cover the remaining $1,750. The lower your deductibles, the greater the risk the insurance company takes on because it allows you to claims for small damages. Choose to take on higher deductibles can save on the cost of insurance.
-
Avoid Small Claims
-
When damage occurs that is covered by your insurance plan, you must make a request for compensation known as a claim. While the purpose of carrying insurance is to make claims if damage occurs, making claims can increase your insurance rates. Avoiding small claims that do not exceed your deductible by a significant amount can save you on insurance costs in the long term. For example, if your deductible is $1,000 and a storm causes $1,200 of damage to your home, you would likely be better off simply paying the full $1,200 than risking the possibility of a rate hike.
Take Advantage of Discounts
-
Insurance companies offer a variety of discounts that can reduce the cost of insurance. Some companies offer multiple plan discounts where if you carry several different insurance plans such as a homeowners policy, an auto insurance policy and a life insurance policy, you get a discount on each policy. Companies may also offer discounts for burglar alarms, updated smoke detectors and other security features. Insurance savings can mitigate the cost of installing safety devices.
-
