Just as with real estate values, location rules when it comes to homeowners insurance costs. According to the National Association of Insurance Commissioners, the average annual U.S. premium was $842 in 2015, the most recent year for which figures are available. Floridians paid the highest rates, averaging $1,534 a year, while at the opposite end of the spectrum, homeowners in Idaho paid $422. North Carolina residents averaged $664 per year. Fortunately, you can take several steps to bring down the cost of your own homeowners policy, short of packing up and moving:
Raise your deductible:
You can shave as much as 25 percent off your premium by raising your deductible from $500 to $1,000 or $2,500, according to the Insurance Information Institute. “Most homeowners have a $500 deductible or less,” says Fletcher Wilson, whose Winston-Salem, N.C. based insurance agency represents competitive home insurers like Erie Insurance, Central Mutual Insurance, and Hartford’s AARP program. “We have moved a lot of our clients to a $1,000 or $2,500 deductible, because it usually makes sense to file only larger HO claims.”
Get a multipolicy deal:
The Insurance Information Institute estimates that buying two or more policies from the same carrier can save you 5 percent to 15 percent. We recommend doing some comparison shopping to be sure that combining your homeowners insurance purchase with your auto, life or umbrella liability policy really does add up to a lower total than you would get if you bought them from different carriers.
Make some home improvements:
You can lower your premium by getting a new roof, changing your heating, electric or plumbing system, or adding new safety features such as an alarm system. Even putting a fence around that backyard trampoline or swimming pool – or getting rid of it altogether – can get you a lower-cost policy by lowering your claims risk in the eyes of your insurance company. Be sure to let us know when you’ve upgraded. “A lot of times customers install alarm systems in their homes, but they never inform us of the activation,” Wilson says. “Depending on the carrier, you can get from 5 percent to 15 percent discounts annually with an activated of central station alarm system.”
Keep your credit score up:
Most carriers use insurance scores, numerical rankings based largely on credit history, in their determination of rates. While your insurance score also includes other factors, such as how long you’ve had insurance, good credit goes a long way toward keeping your homeowners insurance affordable. “It’s safe to say that people who have a better credit rating overall end up receiving a better insurance score,” Wilson says.
Review your policy regularly:
Your annual renewal period is a good time to review your policy to make sure it contains accurate information about the size and construction of your home. Update us regarding any significant changes affecting the home and its surroundings. For example, if you live in a rural area that was recently incorporated into a town that offers municipal fire protection, you can save as much as 60 percent to 70 percent off your premium. Make sure that you are taking advantage of all available discounts and that none of those you already have need to be re-certified.
If you are shopping for a new policy, the Insurance Information Institute recommends using an independent agent to canvas the marketplace on your behalf. Most importantly, please contact our agency
so that we can help you analyze homeowners coverage for your household. It’s always best to double check your specific situation and coverage needs.
Wilson Insurance Services – Our Knowledge is Your Best Assurance™.