How to Reduce Homeowners Insurance Cost

Homeowners is necessary to protect your property investment from fire, theft and natural disasters. However, homeowners insurance premiums will often reflect factors out of your control, such as where your property is located, since many companies rate policies mostly according to their potential risk of loss. To reduce homeowners insurance cost, you can take simple steps such as adding a burglar alarm to the house or clearing brush around your property.

1. Ask your insurance agent if you qualify for customer discounts. Most insurance companies reward homeowners with discounts ranging from long-term customer loyalty rewards to having claim-free histories with the company.



2. Move all of your insurance policies to your homeowners insurance company.Insurance companies reward customers who have multiple policies with the company, such as homeowners, automobile and life.



3. Raise your deductible. If you can easily afford to pay for a repair in excess of your current deductible, consider raising the deductible to the highest amount you are comfortable paying after an incident. Higher deductibles lessen the chance that you will file a claim and most insurance companies reward high deductible policy holders accordingly.



4. Upgrade basic house systems such as electrical, heating, plumbing and roofing. A house with systems newer than 10 years old is considered safer than outdated systems on an older house. Wood frame homes on post-and-pier foundations in earthquake areas will often receive premium discounts once a modern foundation is installed, while homes in hurricane-prone regions can lower premiums by adding storm windows and upgraded UL class 4 Certified Metal roofing.



5. Add more security systems to your home. Insurance companies often give discounts to policy holders who have installed modern burglar, smoke and carbon dioxide detectors on the premises.

  • Before investing in additional security protection, learn how much of a discount you will receive after the installation. Ask your insurance agent what security improvements are eligible for discounts.



6. Clear brush and trim trees around your house if you live in a fire-prone region. Insurance companies will often lower premiums for property owners who create wide swaths of empty space around the property to lessen the risk of damage to the structure if wildfire occurs.



7. Improve your credit score. Insurance companies rate clients based on their credit history; customers with bad credit history will pay higher insurance premiums. If you have damaged credit, take steps to raise your credit score by paying off bad debt, negotiating settlement amounts with creditors and decreasing your debt-to-income ratio by staying out of credit card debt.




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