- Raise Your Deductible
A $500 deductible is commonplace for home insurance. But raising it to $1,000 can cut your premium by 8 to 10 percent. The higher deductible is always a bit of a gamble since you’ll have to pay more money upfront in the event of a claim. But it pays off if you don’t have to file. According to ValuePenguin.com, the average yearly premium in 2016 is $952. If you save 10 percent of that by choosing a higher deductible, then over the course of five to six years you’ll make back the $500 you’d need to spend in the event of filing a claim.
“Homeowners should choose the maximum amount for a deductible that they feel they can afford to pay in the event of a loss. “If you feel comfortable with $1,000, you’ll see savings in your premium. If you can afford more than that, you’ll save even more.”
- Bundle With Your Auto Insurance
If you have a car and home insurance, you really are better off doing them through the same company. Insurance companies can handle billing and processing more efficiently for one person with multiple policies than multiple people who each have one policy, which allows them to offer savings for bundling your home and auto.
“Savings can vary a lot by company, but for those that offer both auto and home insurance, on average you may be able to save 15 percent. “You also have the benefit of dealing with only one agent who knows you.”
- Get a Home Security System
Now that almost every home has a smoke detector and a deadbolt, those items typically won’t earn you much of a discount. But putting in a more sophisticated home security system, particularly one that automatically notifies the police or fire department in case of an emergency, can reap a discount ranging from 2 to 10 percent depending on the insurance company.
“Theft or fire protection systems that send an alert without you being involved can get you a discount, but maybe not as big as many people think,” he says. That’s because these devices help reduce loss costs for just two types of losses out of the many covered by a homeowners insurance policy.
- Stay With Your Company—And Ask Them What They Can Do For You
Some people say you should shop around for insurance every three years to make sure you’re getting the best rates. There’s no harm in comparing rates, but before you jump ship, ask your current agent to confirm you’re already receiving all the discounts you may be eligible for, including a repeat customer discount. Remember, they don’t want to lose you. In addition, Dudich says, some companies offer extra benefits for customers after a certain number of years. For example, Farmers offers a policy that puts $50 per year into a declining deductible account. The balance in this account is used to reduce your deductible in the event of a claim. After five years you could accumulate $250 that would be used to reduce your deductible in the event of a claim.
- Don’t Forget To Notify Your Agent of Home Improvements
Your policy includes monetary limits in the event of a claim on your property, and those limits are set based on the value of your home. So if you make an addition or improvement that raises the value of your property, like a deck or a new building, make sure to let your agent know. If the limit is a quarter-million dollars and you lose $300,000 of value in a fire, you’ll receive only the policy limit, leaving you unreimbursed for $50,000 worth of property.
“If your agent doesn’t know what you have, it can’t be written into your policy to provide you with the additional coverage you may need. He advises that you tell your agent within 60 days of making an improvement that adds $5,000 or more to the value of your home.
- Fix That Roof
Yes, you could end up paying more for coverage if you complete home upgrades that add value to the property. But some of those upgrades can actually save you cash, Putting in a new roof, for example, could save as much as 10 percent on premiums in some locations.
“If you have a new roof, it’s less likely to get damaged by a wind storm or by hail and then need to be repaired or replaced,” he says, so the insurance company might cut you a break on your premium. The same goes for upgrades to the plumbing or electrical systems, because they reduce the risk of damage from an electrical fire or a broken pipe. Ask your insurance agent before you get to work, though.
- Keep a Record of Your Possessions
This is easy to skip, but it can make a world of difference. It’s hard to memorize all of your possessions, and it’s even harder to recall everything you owned after a loss such as a fire. That’s why it’s a good idea to keep a record of all your valuables. “It makes sense to have a record of your possessions, either with a video or written down. “It allows the claims process to be handled much more efficiently and ensures you are able to accurately identify the property you lost.”