How to Make the Most of Your Home Insurance Discounts
Looking for discounts on your homeowner’s insurance and coming up short? Home insurance discounts really do exist, if you know what to look for.
Home insurance rates have been on the rise since about 2000. And now, on the heels of a year packed with natural catastrophes – wildfires, hurricanes and blizzards – most homeowners will see even sharper increases on their homeowner premiums.
It is more important than ever to make sure you take advantage of every homeowner insurance discount available and get the best possible insurance rating on your home.
So, what can a homeowner do to keep their premium down? What types of discounts are available? If you know what to look for, there are home insurance discounts available, and other ways that homeowners can help control the cost of their premium.
Homeowner Insurance Discounts and Being a Good Risk
Multi policy discount – The largest insurers offer a discount on your home policy if you also have an auto insurance policy with them. This can be a substantial discount of up to several hundred dollars a year off your homeowner’s premium.
Having your home and Las Vegas auto insurance policy with the same insurer offers some other perks too – you have only one company to call for servicing and you will most likely have only one bill.
Combining your home and auto policies with the same company can result in a great discount on your homeowner insurance and offer a little more convenience for you. If you don’t have your homeowner and auto policies “bundled” this way, talk to your insurance professional about bundling your policies and getting a multi policy discount.
Best rates for being a good risk – Insurance companies like a “good risk.” This means they like homes and homeowners that don’t pose a substantial chance of having a claim. If you put your best homeowner foot forward and practice good maintenance, protect your property, and keep from filing lots of claims, your insurance company will reward you with good rates and policy discounts.
No attractive nuisances – To help get the best rates and discounts, make sure your property doesn’t have any “attractive nuisances.” These are things that could make your home more likely to have a claim – cars with no registration, broken fences, holes in the ground. Anything that may be broken or in disrepair. Property left outside may be appealing to criminals or looters. Keep your home and property neat and tidy to get the best home insurance premium discount.
Good claims history – Claims happen. That’s what homeowner’s insurance is for, right? But your claims history can have a direct effect on your homeowner insurance premium. If you have a good claims history your homeowner insurance company may reward you with a discount. Have a bad claims history, you may have a surcharge on your policy. The best way to make sure you have a good claims history is to keep your home well maintained and be aware of any signs that there may be a problem.
Deductible – The deductible is the amount of money you will pay in the event of claim before the insurance company pays anything, So, if your deductible is $500 and you have a $1,300 covered water damage claim, $500 will come out of your pocket and your homeowner’s insurance company will pay the remaining $800.
The best way to choose a deductible is to select a dollar amount that you could come up with if needed in an emergency. The deductible can also be selected based on the effect it will have on your premium.
If you have a higher deductible (so you carry more of the financial risk on your own shoulders) your insurance company will respond with a discounted premium. And in reverse, the lower the deductible, the higher the premium.
Alarm Discounts – Equipping your home with a monitored theft and fire alarm will result in a noticeable discount on your homeowner’s policy.
Depending on your insurance company, a monitored alarm can save you up to a few hundred dollars a year on your homeowner premium.
To qualify for this discount, ask your alarm company for an “alarm certificate.” Your insurance agent or insurance company will need a copy of that certificate to apply the discount to your policy.
Discounts for updates to electrical, plumbing and roof – If you have an older home – say older than 20 years, you may want to consider updating your plumbing, electrical system and roof.
Updated plumbing and electrical systems make you a much better risk in the eyes of the insurance company. The same applies to roof updates. These types of updates can discount your home insurance premium.
If you are thinking about updating the electrical, plumbing or roof on your home, talk to your insurance professional about a potential premium discount.
Paperless discounts, pay in full discounts – Most insurance companies offer some type of discount for having paperless billing and policies. There are also discounts for paying annual premiums in full.
The pay in full discount can be substantial while the paperless discounts may be a few dollars. If you aren’t taking advantage of paperless and pay in full discounts, talk to your insurance professional and ask if they are available.
Common rating factors: Discounts or increase?
To take full advantage of potential home insurance discounts and get the best rate you possibly can, it helps to know a little about how a policy is rated.
There are many rating factors for homeowner insurance, and some companies don’t disclose them all, but there are a couple that all companies use:
Location, location, location. It counts for homeowner’s insurance too. Where your home is located can serve to discount your premium or add to it.
Insurance companies divide neighborhoods into territories. Each territory has its own rating factor. It is based on things like crime rates, fire and police station quality, and general neighborhood maintenance.
If you are shopping for your dream home, consider the location carefully – it will affect your insurance premium. You should also talk to an insurance professional about a homeowner’s insurance quote before committing to a purchase.
Protection codes – A protection code is a numeric rating home insurance companies use to help determine your home insurance premium. It has to do with the proximity of police and fire stations in your area, and whether you are near a fire hydrant. For example, if you live in a rural area with no fire hydrants or police stations nearby, your protection code can be very high – driving up your premium.
Make sure you get every possible discount!
So how do you know if you are getting every possible discount and rating benefit available? Talk to your insurance professional. Ask them to do a policy review.
Now that you know a thing or two, go ahead and tell them you want to review all your discounts and rating factors – every single one – no matter how small.
As Ben Franklin said, “Watch the pennies and the dollars will take care of themselves.”
Balsiger Insurance is an independent insurance agency with offices in Las Vegas and Reno, NV, Pasadena, CA and Corpus Christi, TX. Check out each associated home insurance page to learn more about our services. We have great reviews too!