Finance Money Saving Tips

How to Get the Cheapest Home Insurance

How to Get the Cheapest Home Insurance
Written by Irina Vasilescu

Home insurance is a must, whether you have a mortgage or not. Disasters do strike, and although you will certainly hope that you do not experience major storm damage or a fire, being ready for the eventuality by being properly insured will save you a lot of suffering if the worst happens.

At the same time, you don’t want to spend more on insurance than you absolutely have to. How can you protect your assets and still pay less?

1. Shopping around is always step one

When shopping around, look at the premiums and the coverage. Cheap insurance that doesn’t put you back on your feet after a disaster is not worth having. Begin with one of your current insurers. They may be willing to offer you a better rate because you are already a client. Although the financial services industries are relatively well-regulated, you also want to do a little checking on how easily and quickly claims are processed. If you ever have to claim, you will want a quick and efficient payout.

2. Review policies once a year

If you haven’t lately reviewed your home insurance policy, you should. Obviously, checking insured value is important, but you can also look for similar coverage at a better cost and use this information to negotiate with your insurance company.

Hopping from one insurer to another on a frequent basis is not ideal, but there are times when the benefits of a change outweigh any disadvantages. However, always talk about your intentions first, and give your insurance a company a chance to respond. Some insurance companies offer loyalty discounts to clients who stick around. If you are about to qualify for a 14 percent discount, it doesn’t make sense to move your policy for a 10 percent saving.

How to Get the Cheapest Home Insurance

3. Only cover the value of your home

When you bought your property, the value of the land formed part of the deal. Even if your home is destroyed, the land will still be there. You should also consider the costs of rebuilding. Remember, too little coverage will be a major setback. What you are looking for is a balance between effective insurance and low premiums.

4. Check what’s covered

What kind of damage would represent a financial blow to you? Easily repaired items should be excluded from your policy to bring down premiums. Carefully go through your policy to see what it excludes and includes.

5. Opt for a higher deductible

How much damage can you cover with out-of-pocket money? The higher this amount is, the lower your premiums will be. Think realistically about what you could pay for yourself, and at what point you need insurance to kick in. Just $1,000 more on your deductible could cut your premiums by as much as 25 percent.

6. Don’t make unnecessary claims

The more often you claim insurance, the fewer insurance companies are going to see you as a good risk. That means paying higher premiums because your insurers are expecting you to claim. If you don’t claim, you’re a better risk and your premiums will be lower. Keep your insurance money for real emergencies.

7. Improve your credit score

To insurers, your credit score is part of your risk profile. Naturally, a good credit score makes you a more reliable client, so check your credit score to see where you stand, and look at ways to improve it.

How to Get the Cheapest Home Insurance

8. Protect your home from natural disasters

There are many ways in which homeowners can reduce the risk of damage to their homes. For example, if wind storms are common in your area, keeping trees away from structures limits the chance of damage from falling tree limbs.

You can also install storm shutters, and ensure that your roof is strengthened. These efforts will help you to reduce your insurance premiums. To check on which precautions will drop your premiums, talk to your insurer.

9. Improve your security

The contents of your home must also be insured. The more burglar-proof your home is the lower your insurance cost. Again, your insurer can tell you which security measures will have the best effect on reducing insurance payments. You could pay 20 percent less on your insurance if you install a few security features, and you’ll feel more secure in your home.

10. Think home improvements through

Apart from adding to the value of your home, some improvements can increase your insurance risk.

For example, if you add a wooden deck onto your home, it could be seen as an additional fire hazard. If you are thinking of making substantial changes to your home, discuss them with your insurance company to see what impact they will have on premiums.

Always ask!

Are there discounts available? How can you reduce your premiums in other ways? Your insurance company should be willing to advise you.

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How to Get the Cheapest Home Insurance

About the author

Irina Vasilescu

Irina Vasilescu is our crafty designer. She joined the team three years ago and is also involved in the writing process.

2 Comments

  • Thank you for the great tips. I think it’s very important to know exactly what your covered for. The documentation are usually very complicated but you can take it to someone to look it over and explain it to you. Also its very important to know the exact instructions about how to file a claim and who to call rather than scrambling to get the right people on the phone when you claim the insurance.

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