Home insurance is a necessary expense for everyone who owns a home. Most mortgage companies won’t make a loan or finance a residential real estate transaction unless the buyer provides proof of coverage for the full or fair value of the property; most of the time this means the purchase price. If you’re like most people, you want the best coverage, but you also want to save as much money as you can.
Homeowners’ insurance can be very expensive. Those that live in high-risk areas such as close to major waterways, known earthquake fault lines, or other high claims areas will pay the most for coverage. In fact, those in high-risk areas are often forced to pay annual premiums that can be thousands of dollars. But even homeowners in relatively sedate, suburban neighborhoods with property values around the national average could pay a pretty high premium per year for a basic policy.
The good news is that although you can’t avoid purchasing homeowners’ insurance, there are ways to minimize the cost. Here are a few you might want to try:
– Home Security Systems: Special burglar alarms can prevent losses and therefore make your house less of an insurance risk. The insurance company faces less risk that you will lose your belongings to theft if your home has increased security. Plus, as a bonus, it provides you added peace of mind that you and your family are safe in your own home.
– Smoke Alarms: While standard in most modern houses, installing them in older homes can save the homeowner 10% or more in annual premiums. Of course, even more importantly, in case of fire, they could save your life!
– Raise Your Deductible: Your deductible is the amount of money you will be responsible to pay in the event of a claim. For example, if you have a deductible of $700 and your home sustains $3,000 in damage, you will have to pay the first $700 for repairs and your insurance company will pay the remaining $2,300. By increasing your deductible, you agree to pay a little more of the loss in the event of a claim. In return, your insurance company lowers your premium – so, the larger the deductible, the lower the premium.
– Dead Bolt Locks: Dead bolt locks are very inexpensive compared to the possible insurance savings, but make sure all of your doors have them because usually the discount only applies if there are dead bolt locks on every door.
– Credit Rating: Yes, a lot of companies are checking your credit and basing your policy on what is found. Make sure you check to see if your credit is in good shape, and if it is not, you may want to seek out companies who do not do credit checks.
These are just a few ways you can save on your homeowners’ insurance premiums. Call James Campbell today to discuss further cost-cutting measures and to make sure you have the right home insurance policy for you.