How To Save Money on Insurance for Homeowners
Homeowner’s insurance is an absolute necessity in safeguarding the value of your home. As a matter of fact, mortgage companies always ask for proof of coverage for the fair value of a property before making a loan. It is on this regard that a home insurance could well be expensive. If one lives in a high-risk area where the probability of natural disasters is higher, he will most likely pay more for coverage. Even homes in relatively safe places have to be paid with a few hundred dollars to a thousand a year for insurance.
There are some simple ways to minimize the costs however. Here are key aspects that affect the costs of home insurance.
Security System and Smoke Alarms
Investing on a security system that is tied to a central system or a local police station can let a homeowner apply for as much as 5% discount on his annual premiums. He has to show proof of central monitoring though when applying for this discount. On the other hand, the use of smoke alarms can let a homeowner apply for up to 10% discount in annual premiums. This may only apply for older houses where smoke alarms are not customary.
Deductibles and Material of House
One may opt for higher deductibles, as this basically means lower annual premiums. The downside to having a high deductible is that minor maintenance and repair works will not be absorbed by the insurance, and will most likely be shouldered by the homeowner.
The material of a house can also affect the rate of annual premiums. As such, before constructing a new home, owners must give attention to the type of material they want for their new house. Insuring wooden houses is particularly more expensive because wood is more likely to catch fire and incur weather damage. On the contrary, homes made of cement or bricks give in to cheaper insurance rates.
Mortgage and Updating Policies
Paying mortgage debt will lead to cheaper premiums. This is due to the simple reason that an insurance company would assume that a consumer will take better care of a house if it’s actually already his.
Lastly, any homeowner must constantly look for ways to reduce annual premiums. By looking into his policy ever year and even comparing the costs with other competing carriers, one has better chances of saving money. Reporting appropriated changes that will lead to discounts must be done too.
Kevin Walker thanks you for reading his post and hopes you find it informative. He is an insurance analyst and helps people with insurance comparison.