Home Insurance Articles
Five Important Steps In Securing Lower Homeowners Insurance Rates
2010-08-07
Lenders generally require new home buyers to purchase minimal insurance protection, known as hazard insurance, before the buyers can close on the home. This type of coverage only protects against unintentional destruction of property by fire, hail, storms, theft, vandalism, and the like. More comprehensive homeowners insurance, on the other hand, though not required, is a good idea because it protects against loss of furniture, personal items, along with any residential-use structures built on your property. There are five simple steps that can lead to securing lower rates on your homeowners insurance.
The first step would be buying your home and auto policies from the same insurance company. Many companies will deduct anywhere from 5 to 15 per cent from your premium if you buy more than one policy from them. Be sure, however, that the reduced premium is a good value compared to other insurer's home policies. This is why it's a good reason to shop around and compare prices first.
Premiums will vary depending on the risk factor involved in the home and the surrounding area. For instance, if your home is close to a fire station or fitted with fire alarms, or equipped with a burglar alarm system, you are more likely to get a lower premium. You should therefore indicate whether or not these are present in or around your home when applying for homeowners insurance. If your home is not equipped with them, consider installing alarm devices, as they will factor into the price of your premium.
Another step would involve maintaining a solid credit record. Those with good credit histories will tend to secure lower rates. Therefore, pay all your bills on time, keep your balances to a minimum, and don't acquire more credit than necessary. Consistently good spending practices over time will ensure good credit, and therefore better premiums.
Making your home more disaster-resistant, particularly if you live in high-risk areas, will also lower rates on premiums. If you don't know where to start, you can contact your insurance company and ask how to make your home safer against disasters. They might recommend, for instance, that you modernize your plumbing or electrical systems, add storm shutters, reinforce your roof, or other similar actions.
Finally, avoid risks that make insurers wary. For instance, owning pets that are considered aggressive or dangerous (Pitt Bulls, Rottweilers, poisonous snakes, etc.) can cause your premiums to go up, or can even void your policy. Other risks include owning a trampoline or pool, where accidents have been known to occur. If you are not wedded to the idea of owning such things, then you can lower your rates simply by opting not to have them in or around your home.