Homeowners insurance can be costly. This year the average annual insurance premium is $952, though that varies considerably from state to state – Florida has the highest premiums at $1,991 per year, and Idaho has the lowest at $534 per year. But since moving across the country in search of cheaper insurance rates is not something most people are willing (or able) to do, here are 6 easier ways to reduce your homeowners insurance rates.
1. Install security devices
Since homeowners insurance protects your belongings against theft, accidents, and disasters, most companies offer a discount for having deadbolts, smoke detectors, fire alarms, overhead sprinklers, security systems, back-up power generators and other such devices. Anything that makes your house look safer makes it look like a safe bet to insure. But check with your individual insurance company before installing everything you can think of: most insurance companies will grant a discount for having some of these things, but not all of them.
2. Bundle your insurance policies
Almost all companies offer a discount for having your homeowners insurance policy bundled with other policies the company may offer (such as auto insurance or life insurance). Often, the combined policy discount can make your insurance costs lower than they would be elsewhere, even if your individual homeowners premium is higher.
3. Improve your credit score
In many states, credit scores are taken into account when determining homeowners insurance premiums. This helps the insurance company see if you generally pay your bills on time, an indicator that you are a responsible sort of person – the kind insurers want to insure. To improve your credit score, pay off your balances on time and try to keep your credit debt lower than 30% of your available credit.
4. Raise your deductible
If you are the kind of low-risk person who has gone years without having to file a homeowners insurance claim, it might be worth it to raise your deductible. This means agreeing to pay more out of pocket when something happens to your home in exchange for a lower premium.
5. Don’t smoke
It’s pretty common these days to receive a discount on any kind of insurance for being a non-smoker. Your homeowners premium is no exception. Since unattended cigarettes burn down many homes every year, causing a high number of deaths and millions of dollars in fire damage to property, most homeowners insurance companies will offer a good discount if no one in the house smokes. (Plus, you’ll probably get a discount on your health insurance too! If you need help quitting, see Smokefree.gov, a government-run website intended to assist you with your quit plan – or talk to your doctor.)
6. Get rid of the trampoline (and the pool)
If you own a pool or a trampoline, you might want to think about how much you really need these items. They may be fun, but trampolines cause thousands of injuries every year, and swimming pools are the number one cause of death in children ages 1-4 in the United States. As you can imagine, many insurance companies don’t look too favorably on their use – just having either one can dramatically increase your premium. On the flip side, if no one in the family has been out jumping or wading in a while, getting rid of them can save you money and clear up some backyard space.
Finally, it goes without saying that you should always shop around for the best deal when selecting your homeowners insurance company. This means knowing a little a bit about how policies work. A little education goes a long way in picking the right coverage for you and your family.