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10 Ways to Save Money on Homeowner's Insurance Rates

10 Ways to Save Money on Homeowner's Insurance Rates

Homeowner's insurance rates can vary by hundreds of dollars depending on a few variables, including your insurance company, deductible, credit score, discounts, and other factors. When shopping for homeowner's insurance, it pays to look at multiple factors before buying. Here is some information on how to get the best deal on homeowner's insurance or other insurance rates.

How to save money on homeowner's insurance rates

1. Shop Around for better insurance rates. The easiest way to save money on your insurance rates is to shop around for a company that will give you a better deal. Just be sure that you are comparing the same level of coverage when you compare insurance prices and that you are dealing with a reputable company. A good place to investigate insurance companies is with your state insurance regulator's office or the National Association of Insurance Commissioners (NAIC).

Get multiple quotes at the same time. There are several online companies that will search multiple insurance companies for the best rates, similar to Priceline or Travelocity for travel.

When you request a quote through these companies they will give your homeowner's insurance rate quotes from several real estate agents and companies - including most of the major companies you are already familiar with.

2. Increase Your Deductible. Deductibles are the amount of money you are required to pay toward your claim before your insurance chips in. A higher deductible will lower your monthly insurance payments. Just make sure you have enough money in your emergency fund to cover your deductible.

3. Combine your homeowners and auto insurance policies. Many companies will give you discounts for having multiple accounts with them. You may be able to save anywhere from 5-15% with a multiple policy discount.

4. Loyalty Discounts. Many companies offer loyalty discounts for insuring your home with them for a prolonged period of time. Be sure to ask your insurance company if they offer these discounts.

5. Maintain a good credit record and credit score. Your credit score can have a direct effect on your insurance costs. Improving your credit score can lower your insurance costs.

6. Enhance your home security. Most companies will give you a discount on your annual homeowner's insurance bill with proof of a home security system or enhanced security features. Additional items home insurers look for include smoke detectors, fire alarms, burglary alarms, deadbolt locks, and sprinkler systems.

7. Make your house disaster resistant. No home is 100% disaster proof. But if you can prove to your homeowner's insurance company that your home is less likely to suffer catastrophic losses in the event of an emergency, you may receive discounts on your homeowner's insurance premiums. Some examples may include storm shutters, stronger roofing, sprinkler systems indoors and outdoors, structural enhancements in earthquake zones and more. Be sure to discuss this with your insurance company for more details.

8. Review your insurance policy annually. Be sure to reassess your needs and the limitations of your homeowner's policy on a yearly basis. you may find out that you are paying for more coverage than in necessary, or vice versa. You want to ensure you have adequate insurance, but that you aren't paying for more than you need. Don't forget to review the riders you may have for special items such as jewelry, artwork, electronics, or other high dollar items. Also be aware that many homeowner's insurance policies do not cover flood insurance.

9. Insure for the amount to rebuild your house, not what you paid for your house. The odds are high that a substantial portion of your home's purchase price included the land beneath the house. If your house is destroyed, it will cost less to rebuild the house than it would to purchase the house because you are not paying for the land. Don't confuse the price you paid for your house with the cost of rebuilding your house. The land under your house usually isn't at risk from some of the major items covered by your homeowner's insurance, including theft, fire, wind damage, and other damages.

10. Ask for additional discounts. Sometimes all you need to do to get a discount is ask. Also look for membership discounts for being a member of a group such as AARP, AAA, military or trade organizations, and other associations or groups.