How to Save Money on Homeowners Insurance

I’ve written in the past about how to save money on health insurance, life insurance, and car insurance. Today I’m going to round things out with an article on homeowners insurance. What follows is a list of eight tips for reducing your premiums and saving a ton of money.

Focus on your rebuilding costs

While you need to insure your home and its contents against destruction, there’s usually no need to insure the land that it’s built on. Thus, it’s important to think of your actual rebuilding costs (as well as the cost to replace your stuff) when buying a policy. If you don’t, you might end up over-insuring and paying too much.

Increase your deductible

As with other types of insurance, if you’re willing to bear a greater portion of the risk, you can save a significant amount of money. Simply call your agent and ask them to increase your deductible. Just be sure that your emergency fund is large enough to cover your out-of-pocket expenses in the event of a disaster.

Upgrade your security

Things like deadbolt locks, burglar alarms, fire extinguishers, and smoke detectors can earn you a discount. In some cases, these discounts can offset most (if not all) of the additional costs, so it’s well worth checking with your insurer for details.

Bundle multiple policy types together

We get a nice “multi-line” discount for carrying multiple policies with a single company. We actually have two car policies, our homeowners policy, a personal articles policy (for my wife’s engagement and wedding rings) and an umbrella policy all with the same company.

Location, location, location

This one is tough to implement if you already own your home, but… Proximity to fire hydrants, fire stations, etc. can influence your premiums. Not surprisingly, closer is better. No, it doesn’t make sense to move to reduce your premiums, but it might be worth keeping in mind when buying a new home.

Keep your credit report clean

I’ve talked about this one previously… Like it or not, your credit report can influence your insurance rates. Indeed, insurance companies consider clean credit to be an indicator of reduced risk. Thus, it’s important that you check your credit report regularly, and fix any errors that you find.

Ask about other discounts

You can often get a group discount (e.g., alumni association, senior discount, etc.) just for the asking. Give your agent a call today and find out if there are any discounts they can apply to reduce your premiums. If you don’t currently qualify, perhaps there is a group that you can join to get an additional discount.

Shop around

Assuming that you’re doing everything else right, another great way to save money on homeowners insurance is to comparison shop. You can either call around to local agents, or check a homeowners insurance comparison tool. Whatever you do, be sure to buy from a reputable company so you won’t run into any problems if/when you file a claim.

So there you have it… Eight simple tips for saving money on homeowners insurances. If you have any further suggestions, please be sure to share them in the comments.