9 Strategies for Lowering Homeowners Insurance Costs


Homeowners insurance is rarely discussed, but it can be secretly costing you more than you think.

The good news is that insurers provide a range of discounts and incentives that might help you lower your homeowners insurance premium.


These are nine methods to save money.

1. Increase your deductible

A easy approach to minimize your premium is to boost your homeowners insurance deductible, the amount you pay if you have to make a claim. According to NerdWallet’s rate research, if you had, let’s say, a $1,000 deductible, raising it to $2,500 would result in an average annual savings of 12%.

By increasing your deductible, you can keep more of the money you would have paid to your insurer each month. But be sure you have enough money set aside to pay a larger out-of-pocket expense in case you need to file a claim.


2. Increase the security of your home

When it comes to home security, even the fundamentals can help you save money.

Mark Friedlander, spokesman for the Insurance Information Institute, claims that having a smoke detector, burglar alarm, or deadbolt locks on your house can qualify you for a 5% discount. According to him, you might save up to 15% to 20% by integrating a thorough sprinkler system with an actively monitored fire and burglar alarm.

3. Ignore minor claims

Even when something very insignificant occurs, it may be alluring to submit a claim to your insurer; however, you might be better off in the long run if you pay for these modest charges yourself. This is due to the fact that certain insurers give discounts if you go several years without filing a claim.

How much may submitting a claim have an impact on your rates? According to a recent NerdWallet survey, filing a claim for wind damage increases your annual insurance costs by nearly 9% on average. On average, a water claim increases your annual premium by around 19%. If your claim is very minor, you could end up paying more in rate hikes than the insurer pays out.

4. Inquire about obscure discounts

Unless you check, you may never know what other savings you might be eligible for. If you: • Don’t have any smokers residing in the property, several insurers give additional homeowners insurance discounts.

• Pay your premium with automatic bank instalments.

• Choose paperless billing.

• Pursue a career in a certain field, such as engineering, teaching, or firefighting.

5. Take into account home renovations

You might not even be aware that you qualified for homeowners insurance discounts if you made improvements to your house. Insurance costs may be reduced by adding elements that make your home more resilient to damage, such as storm shutters and impact-resistant roofs. Upgrading old electrical and plumbing systems may also result in a discount.

According to Jessica Hanna, a representative for the American Property Casualty Insurance Association, “you can frequently request a new inspection of your house to analyze these improvements to optimize your possible discounts.”

6. Combine your auto and home insurance

According to research from the Insurance Information Institute, you can normally save 5% to 15% on your homeowners premium by bundling your vehicle and house insurance with the same provider. Several insurers offer discounts if you purchase more than one type of policy from them, though this may vary based on your company.

7. Increasing Your Credit Score

You might be surprised to learn that your credit score can have a significant impact on your home insurance premium. That’s because in most jurisdictions, companies can use a credit-based insurance score to set your rates. You can be charged higher rates if your insurer determines that your credit score is too low, such as having a FICO score below 630.

If you discover that your credit score is low, carefully review your credit report to locate any mistakes. By making timely payments and lowering your credit card balances, you can improve your score. Learn more about how to create credit.

8. Get rid of high-risk goods

Even while it could be entertaining, possessing something that your insurer deems a “attractive nuisance” — such as trampolines, swimming pools, or playground equipment — can raise the cost of your homeowners insurance premium.

An enticing nuisance is a feature on your property that children could be encouraged to play on. You might be held liable if they suffer an injury as a result. You might be able to reduce the cost of your homeowners insurance by getting rid of those items because insurers view them as a liability risk.

9. Compare prices

Rates for identical homeowners insurance coverage might vary substantially from one company to the next. Finding the best rate might result in annual savings of $1,000 or more for certain homeowners, according to NerdWallet research.

Many businesses provide features on their websites that allow you to fill in some basic information and acquire rapid house insurance estimates. Checking several companies’ rates will enable you discover if you might be able to save by switching insurers. You can also request that an impartial insurance agent or broker compare rates on your behalf.


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