A break in. A robbery. A fire. A tornado. An everyday mishap that somehow causes a lot of damage. A lot of things can go wrong in a home, regardless of the tenacious nature of an owner, and when they do that home can come tumbling down. Bad times.
The solution? Homeowner’s insurance. Designed to cover a fairly large array of mishaps, homeowner’s insurance is just the ticket for those unpredictable catastrophes that sneak up on homeowners just a bit too often these days.
True, it’s possible to protect your house for decades at a time without possessing even the slightest bit of insurance, but why take the risk?
Unfortunately, however, with the added protection of homeowner’s insurance also comes the cost of protection.
Premiums can be costly little devils: according to the Insurance Information Institute, for example, American homeowners spent an average of almost $800 a year on homeowner’s insurance premiums. Ouch. And that was in 2008, so it’s possible that number has risen.
What’s to be done for those poor folks who either don’t want to pay or can’t pay that high a price? There are, fortunately, some options. Here are eight things you can do to lower your homeowner’s insurance premiums. They’ll still cost money, but you should save a bit in the long run – and your house may even wind up safer than before.
Shop around
So you’ve got a nice, solid insurance company already. Do they offer the best bang for your buck? Maybe, maybe not. You probably don’t know for certain, however, so look at other insurance companies in your area and country, particularly if you want a company that specializes in homeowner’s insurance.
Ask friends, check the yellow pages, look for ads in newspapers, and look online. There are tons of companies out there; you just need to find the one that best suits your financial needs.
At the same time, though, consider remaining loyal. True, the market may prove the superior choice, but not always. Many companies offer premium cost reductions to loyal customers if they stay under the company’s umbrella for several years.
Contact your company and see if (or when) you’d be eligible for such reductions. Waiting a couple minutes may prove beneficial if the company offers discounts … and if they don’t, well, you need not fret over switching companies so much.
Raise your deductible
This is a common piece of advice from insurance experts, and pretty sound. Raising the deductible on any claims you make shows the insurance company that you’re not about to try and scam them with a small claim that they’ll have to shoulder themselves. Generally speaking, the higher the deductible, the lower the premium.
Consolidate your insurance
If you have homeowner’s insurance, then you probably also have car insurance. Life insurance. Health insurance. Credit insurance. Any number of types of insurance.
If you can get all of these things under a single roof, you’ll likely get premium reductions on the whole. The further you split your insurance, the more expensive they’re all likely going to be, homeowner’s insurance included.
Carefully evaluate the worth of your home and its contents
Assuming your coverage is all-encompassing, you want to make sure you’re not paying too much for your house and its valuables.
Are you, for example, basing the worth of your house on the ground it’s on as well as the structure itself? Homeowner’s insurance doesn’t cover turf, so knock that off. And are your possessions worth as much as you’d thought? Did you value something particularly high a few years ago that’s depreciated considerably?
Reporting as much can bring your premium down a bit as well. Make sure you catalog your important belongings every so often to ensure accuracy, not to mention remain prepared in the event of a problem.
Reinforce your house against the elements
This is of particular interest to anyone who lives in a natural disaster zone, such as Tornado Alley in the United States. Insurance companies look kindly upon homes that have stronger roofing, reinforced windows, lightning protection systems, and other such security measures to keep a home ticking during a severe storm.
Before installing anything, however, check with your insurance company to see if they have any specific requirements, as some companies only approve of certain products. Note, too, that you’ll probably have to endure an inspection before you see a reduction in your premium.
Outfit your house with a security system
Burglars and thieves are ever on the prowl, and ensuring the safety of your belongings (and the premises) will put you in an insurance company’s good books. As with weather protection, though, check with your insurance company to see which companies they prefer.
Consider moving
Drastic, perhaps, but why not? Some parts of the world, thanks to crime rates, bad weather or poor reputations in general, will invariably command higher premiums of their tenants. Get around this by moving somewhere that’s a bit safer.
On a final note, make sure to do your math before you set out to reduce your premium. Are your cost-reducing efforts actually going to save money? Or will the money wind up in someone else’s hands?
True penny-pinching homeowners should either sit down with a calculator and scope out their situation or, perhaps better in the long run, sit down with an expert and ask some pointed questions.
