Home Insurance Articles
Three Reasons Newer Homes Have Lower Homeowners Insurance Rates
2010-08-03
Buying a home is the biggest purchase that most people make. When choosing whether to buy a new or existing home, you should consider the impact that it will have on your homeowners insurance. Home insurance quotes for new homes should reflect a discount for three main reasons.
A new home may have more features that would cause an insurer to assume there will be fewer claims to pay. The structure and materials used in a new home will usually be in better condition than an older home. In a new home, the electrical and heating systems are less likely to be a reason for a claim because these systems will be more up-to-date with modern safety features. The same is true for a new plumbing system that will have less chance of causing any problems in the home due to shut-off valves and better pipes. A new home is more likely to have a reinforced roof and be built of materials that protect the home from winds, earthquakes and other destructive forces. Many new homes incorporate recent innovations in protecting a home. When fewer claims are expected, the insurer is likely to give a discount on home insurance quotes.
Another advantage of a new home is that you can be sure that you are located in a lower risk area, such as being away from coasts and flood plains. If the new home is in a community with other new homes, it is likely that there will be fire hydrants close by and that there will be a neighborhood fire station. Homeowners insurance rates are higher if a home is serviced by a volunteer fire department or is far away from a fire station.
New homes will often have fire alarms and sprinklers built-in to minimize the damage from a fire. Security systems can be incorporated into new home construction in order to reduce the chances of being burglarized. These systems may include burglar alarms, deadbolts and locking windows. If the alarm is connected to a monitoring agency that automatically alerts the police or fire department, the discount may be even deeper. Because claims for fire or theft are assumed to be less likely when you have an alarm system installed, you may see a reduced rate in the home insurance quotes that you receive.
When considering a newer home over an older one, take into account the cost of homeowners insurance. Discuss the possible discounts with your insurance agent and make a list of questions to ask the builder or Realtor. Choosing the home with the right features in the right location can make a big difference in the rates that you will pay.