Homeowner insurance rates are headed up in many states this year. Colorado’s new average rate is around $3,400, Oklahoma is now $3,300, Tennesse has also moved up on the list to an average home insurance rate of $3,000 per year. Kansas and Texas are both around $2,500 for the year. While your premium may be headed up, there are still a few ways to save a bit of money on homeowners insurance.
Here are a few tips to help keep your homeowners insurance affordable:
- Shop your coverage: This is probably the best ways to lower your insurance costs. Insurers rate risk differently which can result in dramatic differences in premium quotes. Shop your coverage at least once a year and get quotes from at least five different insurance companies.
Make sure you are comparing apples to apples when it comes to coverage levels and deductibles and always check out the financial ratings of any insurer you are seriously considering.
- Bundle Home and Auto Insurance: Insurers offer tons of discounts and one of the largest discounts they offer is for bundling your home and auto insurance. Bundling just means that you are purchasing your auto and home insurance from the same insurance company. This discount can range up to 25% so shop around to see which insurance company offers the largest bundling discount for your particular situation.
- Discounts: Bundling is not the only discount insurers offer. Most insurers offer a wide variety of discounts, and your job is to make sure all the discounts you qualify for are being applied to your policy. Ask your agent to do a discount review to make sure all available discounts have been applied to your various policies.
- Upgrade your home: Upgrading your home can be a great way to lower your premium, insurers offer discounts for upgrades that help protect your home. Adding fire and wind resistant roofing materials or a monitored security system can result in major discounts on your premium. Check with your insurance company to see which upgrades will result in a discount.
- Up Your Deductible: Insurers love it when you have more skin in the game so if you can afford to up your deductible, your insurance company should lower your premium. The deductible is the amount you must pay before your insurance kicks in to pay for a covered loss.
Doubling your deductible should result in a significant discount. Always choose a deductible that you can easily afford in the event you have to make a claim on your policy.
- Improve your credit score: Statistics show that homeowners with good credit scores file fewer claims then those with poor credit, so insurance companies take your credit score into account when setting a premium.
If you have a low credit score (anything under 650) do your best to improve it by making payments on time, pay down your debt and check your credit report to make sure there are no mistakes on it which are bringing your score down.
- Keep an inventory: While this tip won’t lower your premium, it will help make sure you are paid quickly and fairly in the event you must file a claim on your policy. Keeping an inventory of all your personal possessions will make filing a claim easy and will ensure that you are paid fairly for all your possessions.
You should take photos and record information such as date purchased, and price paid. You should record the serial numbers and other important information about electronics and other high value items such as jewelry or artwork.
- Save your insurance for big claims: Numerous claims on your policy will dramatically raise your rates. Homeowners insurance should be saved for major incidents while smaller issues should be paid out of pocket to help keep your premium low. Consider paying out of pocket for any small claims, save your homeowners coverage for big claims.