7 Ways to Reduce Your Home Insurance Premium

Date October 5, 2008 By Debbie Dragon

Home owner’s insurance premiums are costly, but there are a number of ways you can reduce the amount you pay to cover your home against the unthinkable.  Here are 7 ways to reduce your home insurance premium:

1.  Install an alarm system.  Most insurance companies will provide you with a discount if you have an alarm system installed in your home.  Discounts range between 5% and 30%.

2. Combine all of your insurance policies.  Look for an insurance company that offers multiple lines of insurance policies and then insure everything with one provider.  For example, your home owner’s insurance, automobile insurance, and life insurance can all be with the same company which will likely result in a “multiple line discount”, typically 10% off your total insurance premium. Look for a mortgage list brokers which can help you get a list of providers in your area, specifically ask for their direct mail mailing lists which will contain all of the latests ads and offers.

3. Disaster Protection and upgrades.  In areas that are prone to natural disasters (earthquakes, hurricanes, etc) you can often install features like reinforced roofing or storm gutters and gain a discount.  Sometimes upgrading your heating and electrical systems will give you an insurance premium discount as well, so check with your company to find out if any of these home upgrades will result in a discount.

4. Stop smoking.  Not only is smoking bad for your health, but it’s one of the leading causes of home fires.  Smokers pay less for home owners insurance than non-smokers.  Quit smoking and call the insurance company to update the record for a lower insurance premium.

5. Raise the deductible.  Just like automobile insurance, homeowner’s insurance premiums have deductibles.  This is the amount of money you pay if you submit a claim; the insurance company pays for damages above and beyond the deductible amount.  If you can afford to raise your deductible from $500 to $1000, for example, you can experience savings of around 25%.

6. Raise your credit score.  It seems more companies are relying on a credit score to determine how much people should pay for certain policies- and home insurance often relies on your credit score as a determining factor in how much you’ll pay for home owner’s insurance.  Agree with it or not, the best thing you can do is raise your credit score.

7. Forget about the land.  Most disasters will cause damage to your home, and very little to the land.  Decide to cover your home only and you’ll save considerably on your home insurance premiums. Many marketers that collect new homeowner lists will specifically market home-only insurance. If your land is in a hot area, you don’t need to insure it.

Category Posted in emergencies, family, financial plans, insurance, lifestyle, personal finance basics, real estate, savings, security, services

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