The Easiest Ways To Save On Your Homeowners Insurance You May Not Know About
Homeowners insurance is an essential protection that keeps your home and belongings covered in the event of an emergency of all sorts. Bankrate reports that homeowners insurance is a typical mortgage requirement as well, making it more than just a great thing to have tacked onto your overall property expenses. Value Penguin notes that a figure of around 85% of all homeowners in the United States pay for homeowners insurance, with average costs of $1,445 per year.
Because it's such a prevalent component of homeownership, there are a few fantastic approaches that you can use to reduce the overall cost of your policy. Bankrate notes a few key means of bagging a significant price reduction, but the truth is that smart thinking and a grasp of how the insurance industry works on a broad level can help make these opportunities for a bargain turn into realities.
Continue reading to learn about a few simple tactics you can employ to reduce the premiums on your homeowner's insurance, saving you essential cash that can go toward mortgage repayment or even spending on entertainment for you and your family.
Compare pricing before signing on to a policy
The most important thing you can do as a homeowner looking for new insurance coverage, or a buyer seeking it for the first time, is to compare pricing on the market. Shopping around for insurance coverage gives you a range of options and helps you make a smart choice about your policy costs, the types of things that will be covered, and more.
Bankrate reports that a comparison site or a personal compilation of quotes can help you make the best decision about your homeowner's insurance coverage. Providers will vary in what they offer in the policy, along with differences in deductibles, premium payments, and more. However, sometimes, you'll find what amounts to a carbon copy of a policy offered by a competitor for a much better rate. Shopping around gives you access to different pricing options and policy outlines. Making a spreadsheet or utilizing another comparison tool to help make sense of how different options stack up is the best way forward when trying to get a great deal on homeowners insurance.
You may need certain protections and find others unnecessary, so partnering with a provider that gives you exactly what you're looking for while offering the best rate on the market should be your first objective when shopping around for insurance coverage.
Bundle insurance products for a discount on multiple policies
Bundling your insurance products can make for another opportunity to lock in essential price reductions, according to U.S. News & World Report. Every driver in the United States needs auto insurance, and many homeowners use other protections in their daily lives as well — health insurance, life insurance, etc.
Bundling these insurance products together can get you a great deal on each one of these essential products. For a homeowner taking out a new mortgage (or refinancing their existing loan), looking into coverage of homeowners insurance and auto insurance products from the same provider might give the best overall discount on both policies. Bundling insurance products is a great way to minimize bills as well. Paying the same company for multiple policies streamlines your budgeting needs and makes the insurance checks easier to account for, both in the amount you'll have to pay out (in many instances) and in the scheduling of payments by reducing the number of individual expenses to keep track of.
Bankrate reports that insurance companies often give out their best rates to customers that combine policies, consolidating their coverage under the umbrella of a single provider. In a business sense, this makes a lot of actual sense: Instead of enticing a new customer to sign with them, they can double or even triple their business relationship with a single person. Winning back a single customer means winning multiple sales at the same time.
Work to improve your credit score to reduce monthly or yearly costs
Bankrate also notes that in most states (with the exception of California, Maryland, and Massachusetts), your credit score can be used as a part of the cost calculation for writing new policies. Because it can, it often is brought into the equation. This means that an improvement to your credit score can reduce the monthly premiums you pay.
Focusing on repaying debts, particularly revolving lines of credit, in the months leading up to your insurance policy's renewal or expiration date is a great way to tackle this issue. Improving your credit score can help boost your financial standing in a number of key ways, and one of them comes in the form of reduced payouts to insurance providers. The less you have to pay for the same service (often one that you never make a claim against and therefore actually use), the more money you'll keep in your pocket for other expenses, needs, and general use.
A good credit score can be leveraged into all kinds of benefits, and a reduction in the cost of insurance products is often one of them.
Keep your roof in good condition
Appraisals of a home tend to include a consideration of the roof. Because roofing repairs and replacements are so expensive (in relation to other repair works that take place in the home), a roof that's in good standing can be a major asset to you in many ways.
NBC News reports that roof-specific discounts can rise to as much as 35%, with a real dollar recouping of costs taking perhaps 20 years to realize. This is actually a unique asset in disguise. If you are in need of a new roof, spending the money to replace your existing house covering and then bringing in the related discount can actually pay for the roof in its entirety. The roof on a typical home is rated to last around 20 years (via Roof Advisor), meaning the project and discount combined end up in a wash over the long term.
Maintaining your roof is a good idea under any circumstances, but with the added benefit of improving your cash flow with an essential discount on homeowners insurance, the value of great maintenance routines in this part of the home rises to a new level.
Carefully consider each claim you plan to make
Unfortunately, one thing that helps reduce and maintain a low monthly or yearly cost of an insurance product is disuse of the actual service. Bankrate notes that there will always be times in a homeowner's life when calling in the coverage provided for in a policy might be useful to reduce the out-of-pocket expense of fixing some kind of issue in the home. However, making a claim will inevitably raise the cost of your ongoing coverage for the foreseeable future.
It's a good idea to weigh up your options for remedying any type of situation that you face. For smaller issues in the home, even though you have coverage and pay for it every month, calling in the service may not end up making financial sense. Saving your claims for use in dire circumstances (after a severe storm that may have felled an old tree right on top of your roof, for instance) can provide you with a low overall cost for the policy throughout your time in the home and the potency of the insurance coverage when it really counts.