Natural disasters are unpredictable, and fires or flash floods can happen at any time. Homeowners insurance is astounding protection for your premium. Especially if your home is located in a disaster-prone zone (such as wildfires in California). Costs can skyrocket up to thousands of dollars in no time flat. Least of all because of personal liability costs, or patching a leaking roof. Here are 7 ways to lower the premiums of your insurance.
1. Compare Companies
Each insurer has different policies, various coverages and differing prices of both. It is also vital for your premium to review any consumer complaints of previous customers against the company. Always compare quotes between companies if you care about saving on your premium. More work? Yes. Better deal for you? Absolutely.
2. Combine Policies
Do you buy auto insurance from one company, and homeowners insurance from another? You may be losing more money than you realise. Certain companies will offer you 5-15% discounts if you buy both coverage types. It shares a concept with comparing prices for grocery stores: look at both prices of policies separately, then ask the company if they offer a combined policy for both.
3. Get Higher Deductibles
According to the terms of your policy, you may have to pay a set amount for a loss. This will be paid before your company even touches the claim. Know that your policy may have a separate deductible for different types of damages; for example, windstorm deductibles, hail deductibles separate from the rest of the policy, etc. There are three types of deductibles: a dollar amount, a percentage, and a split.
A dollar amount is a fixed amount sum
A percentage is a percentage of the total amount of coverage set forth in your policy
A split is a combination of the previous two
4. Home Building Costs
Discuss home renovation/building costs with your insurance agent. You will never know how much damage will occur to your home without reviewing the costs of any potential damages. Knowing how much your home structure and contents costs can save you a lot of money so you can budget for them.
5. Disaster Resistance
Make sure your home is resistance to windstorms, thunderstorms, lightning, etc. Adding storm shutters, buying stronger roofing materials to reinforce it are just two things you can do to save money on your premiums. Contact your insurance agent to see if it is possible, as you most likely need to modernize your heating and plumbing systems.
6. Beware of Claims
If you can afford to pay minor claims from your own wallet, you will save money long-term. However, claims drive premiums up. Making a lot of claims tips off insurance customers about your high risk. Your claim may even be cancelled, depending on your carrier. By all means, make claims if you must – nobody likes people who cry wolf.
7. Do You Need It?
Of course, you should never buy insurance for disasters that may never actually happen. Do earthquakes happen in your area often? If not, why buy insurance that covers earthquake damage? This shares the same principle with decluttering your home. If you’ve held on to a lot of junk for years, simple for the purpose of “using it someday,” do not make the same mistake with insurance.
Always before to review your yearly premium and policy to stay up to date. Prices and costs change over time, and without keeping an eye out, you may end up biting off more than you can chew in your policy.