Owning a home already comes with a lot of expenses that add up in unpredictable ways. Because of this, you should always be ready to jump at any opportunity to lower your total costs. Nobody should be paying more than they have to as homeowners!
One of the surest ways to do this is to get the cheapest home insurance possible. There are many methods available to you to drop the price you pay significantly, so take advantage of them!
Not sure where to start? Here are 7 ways for you to get cheaper home insurance:
1. Shop Around for the Cheapest Home Insurance
To start off, don’t just settle for the first offer you come across. Even if it sounds like no other company could possibly beat the prices one company offers, still do your homework and shop around.
But be careful when you do come across a great deal. Cheaper premiums are often the result of weaker insurance coverage, so it’s wise to review insurance rates to figure out exactly what you’d be paying for.
Ask for the rates of a handful of insurance companies before you make your choice, and compare what each company offers for the price they charge. You can even read customer reviews of your options to know how well they’ll serve your needs based on how they’ve treated their other customers.
2. Improve Your Credit Score
If you can establish a solid credit history, insurance companies will take notice.
When calculating your “insurance score”, these companies will use the information in your credit report to help them predict against future losses. If you have a bad score, they’ll assume that you’re more likely to file a claim and less timely in paying your bills.
Your insurance score considers your outstanding debt, how long you’ve been building credit, and how often you file applications for credit. If a company finds you to have a higher score, you’ll have less to prove… and a lower insurance bill because of it!
One way to help improve your credit score is by checking it as often as possible. There are resources online that allow you to check your score for free once a year, including Equifax, Experian, and TransUnion. If you find any errors, correct them immediately so your record properly reflects how responsible you are.
3. Bundle Your Policies
Many companies offering home insurance also provide auto and life insurance policies. If you decide to bundle these together, odds are you’ll have some awesome discounts.
These bundles are called Multi-Policy plans. By using them, you can receive discounts because you are choosing to use the services of only one company. They appreciate your extra business and reward you because of it.
For example, Allstate provides you with up to 35% off your home premiums if you also have auto and life insurance policies through their company. These savings are definitely worth it and add up over the time you spend living in your home.
4. Increase Your Deductible
Raising your deductible is one of the more straightforward methods of ensuring you have the cheapest home insurance.
A deductible is the amount of money you pay before your insurance company steps in and pays the rest of the claim. The more you pay toward the claim, the more money you’ll save on your premium.
Typically, insurance companies recommend a deductible of around $500. If you can afford to pay more (closer to $1,000), you could save as much as 25 percent.
Remember, your deductible comes out of any claim payment first. That means it may be more difficult for you later when the time comes to make a claim. So, be careful if you choose this route.
5. Improve Your Home Security
Some simple ways of improving your home security include:
- Installing deadbolt locks in your entry doors
- Signing up for a home security service (homes without these systems are 3 times more likely to be broken into)
- Upgrading your smoke detectors and installing a sprinkler system
- Utilizing automatic notification systems to alert local police and fire departments
If you don’t take these steps and you become the victim of burglary or damage, your insurance provider may even question your claim.
But, by implementing these improvements, you become less of a liability to insurance companies. Plus, showing them that you are proactive and take your home security seriously means you may be rewarded with a significantly lower insurance bill.
6. Fortify Your Home Against Disaster
Different parts of the country suffer more frequently from different sorts of natural disasters.
If you live along a coastline, hurricanes might pose a serious threat. If you’re in the Midwest, tornados are something you have to be wary of. And if your home is anywhere near a fault line, earthquakes are always a possibility.
This is why insurance companies often ask you to pay extra to cover the risk they’re taking in insuring you when you live in these areas. If they believe that your home may be under threat from forces beyond the normal wear and tear, it makes sense that they wouldn’t want to have to always foot the bill.
However, if you add storm shutters or reinforce your walls, roof, and windows, your insurance company may take notice and reward you for your precautionary measures.
7. Find an Insurance Provider with Loyalty Discounts
If you’ve been a customer of one insurance company for a long time, they may start offering certain discounts. These discounts can start at as low as 5 percent, but could increase over time depending on your plan and which company you choose.
If you can maintain a good track record with your home insurance carrier (especially if you rarely file claims except on the most serious occasions), you may be given higher discounts when it’s time to set your rates.
However, don’t stay loyal just for the sake of loyalty – or because you hope a loyalty discount may be provided in the future. If you have the opportunity to find a better, cheaper insurance policy, toss the old guys like bad leftovers.
If you have any questions about how to find the cheapest home insurance, I’m happy to help. Contact me by calling or texting 254-258-0777. I look forward to talking to you!