12 Tips to Avoid Overpaying for Home Insurance

Fran
Fran Majidi
May 23, 2019

Paying too much for anything is pretty painful. Paying too much for insurance is no different. Homeowners insurance is often where we neglect to look closely at the numbers to decide if we’re paying the right amount or overpaying. However, just because you’re paying more doesn’t mean that you have superior coverage so it’s time to look a little more closely at what determines your rate. We’ve listed 12 ways you can lower your homeowners insurance rate so you can rest easy knowing you’re protected without getting price gouged! We’re always here to help.

  1. Comparison shop home insurance policies.

    You may have been with the same company for years and feel hesitant switching your homeowners insurance carriers. Often it’s because you’ve had the home insurance policy as long as you’ve had the mortgage on your home. In fact, your insurance may feel tangled up with your mortgage payments. Maybe your lender set up an account on your behalf so you didn’t really get a chance to compare rates. Regardless of how you ended up with your current policy, it’s advisable to shop around to see if you can get a better rate without compromising on quality. SmartFinancial can give you multiple free quotes.

  2. Get a new insurance quote every two years.

    You should shop around for home insurance quotes every couple of years, to make sure you’re getting a competitive rate. Your goal is to have the highest level of insurance for the lowest price. If you’re not shopping around every couple of years, your rate and coverage may no longer reflect your needs.

  3. Report changes to your carrier.

    Home values often change, especially if you upgrade your home with a swimming pool or a new kitchen. Whenever the value of your home increases or decreases, you should adjust your policy accordingly. Even if there’s an increase, it’ll be well worth it to make sure your policy covers you thoroughly.  You’d rather pay a few dollars more a month than not be covered fully if something were to happen to what may be your most valuable asset. The same goes for belongings kept in the home. Let’s say you added a gym to your house and that room holds state-of-the-art equipment. You ought to add a rider to your home insurance in case there is a fire or natural disaster that destroys your new Peloton bike or even your pearl necklace. Let SmartFinancial pair you up with a top agent.

  4. Get all the discounts you can.

    You may be eligible for more discounts than you think. Often, your agent doesn’t even know that a certain discount applies. Ask questions to see which discounts apply. Did you know that if you’re retired you get a big discount on homeowners insurance? Also, your job and professional associations may earn you even more savings.

  5. Bundle your homeowners insurance with your auto insurance.

    Bundling two policies together isn’t just convenient. It can save you lots of money. If you aren’t insuring your car and home with the same carrier, it’s time to make the change now. In fact, the more policies you buy from the same carrier, the more you can negotiate a lower premium for all of your insurance products.

  6. Insurance rates fluctuate every couple of years.

    The value of your home isn’t the only thing that changes constantly. Insurance rates vary from year to year as well. By comparison shopping for homeowners insurance, you’ll see if you are currently paying too much. You may also make a new connection with an agent who can lower your rates for other coverages, like auto or life insurance. Let SmartFinancial bring you multiple free home insurance quotes to make your life easier.

  7. Your lenders requirements changed.

    Your lender has specific requirements about how much homeowners insurance they require you to have. This requirement is usually based on the mortgage amount. As the amount you owe goes down, you may be able to lower your home insurance premiums as well.

  8. The number of people living in your home changed.

    Your home insurance takes other inhabitants into consideration because the coverage for medical bills would apply to anyone who gets hurt on the property. As you can imagine, the risk decreases when fewer people reside in your home. If a child has left the nest make sure to update your information with your agent so you can get a break on your insurance premiums.

  9. Raise your deductible.

    If you’re having a hard time with your current premium amount but have already shopped around and know you’re paying the least for the best insurance, you may want to consider raising your deductible. What that means is that you’ll have to pay more upfront if you do end up filing a claim. You always have to pay a deductible on home insurance before the carrier picks up the tab. Just make sure you can get that amount or have it in an emergency fund in case you do have an unforeseen disaster with your home.

  10. Your home’s value is what you need to insure.

    If you included the value of the land your house is situated on, you’re probably paying too much for insurance. The reason why this is the case is common sense. You don’t need to protect land from natural disasters and fire. The reason behind having home insurance is to pay for rebuilding your home if something were to go wrong. You would not need to do anything to the land. Don’t include the land value when deciding how much home insurance to buy and your rate should go down immediately.

  11. Improve your credit.

    Many insurers are using credit history to determine risk so your score may be raising the rate of your homeowners insurance and even auto insurance. Check to see if this is the case by monitoring your credit, where you’ll see what is bringing down your score. After you take care of any delinquent accounts and your score improves, you should let SmartFinancial do some thorough comparison shopping for both your home and auto (preferably with a bundle discount).

  12. Get private insurance.

    Often, people who are on a government plan and live in high-risk areas benefit from switching to a private carrier. You can get a quote to see which works better for you. You’re under no obligation to switch, but you may be able to save a couple of hundred dollars doing so. It’s worth it to see, so visit here and enter a zip code to start a quote.

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