When you add it all up, the total cost of insurance premium is a significant share of most household budgets.  Car insurance, homeowners insurance, and a host of additional forms of coverage add-up quickly.  Add in the cost of health insurance and life insurance, and the total share of monthly spending related to insurance climbs even higher.  While there are savings opportunities in every single insurance spending category, homeowners insurance is a prime target for trimming costs.

It is always tempting to simply renew your existing home insurance policy.  If you haven’t made any claims and there are no substantial changes to your property, it is easy to just return your payment and be done with it.  Unfortunately, you may be leaving money on the table when you blindly renew homeowners insurance every time it is due.  Instead of taking the easy way out, evaluate you insurance coverage at each renewal date.  You may uncover savings opportunities by taking a close look at premiums and discussing coverage with your current agent, and moving to another provider might even make sense, if your current terms are questionable.

 

Informed Consumers Save Money on Insurance

Learning about insurance and calculating your options is the first step toward saving money on your homeowner’s policy.  It is easier than ever to compare quotes using web-based resources designed to contrast insurance alternatives.  Once you have a handle on your options, it is easier to pick the most cost-effective solutions for your particular home coverage needs.

Home policies are essentially broken into two distinct areas of coverage.  The first aspect of your policy covers the buildings and structures themselves, while the other half of your homeowner’s contract relates to the personal belongings kept on your property.  It is important to understand this distinction, so your protection covers the value of your home and contents, without adding unnecessary insurance costs.

The structural portion of your policy accounts for the main house or building on your property, as well as your garage or other features found there.  Sheds, storage buildings, workshops and other structures used in agriculture are covered by the building insurance, as well as fences, retaining walls and structures extending from the buildings you own.  The contents part of your homeowner’s policy covers basic possessions like clothes and furniture, but it can also be adjusted to provide protection for particular items you own.  Valuable jewelry and collectible items, for example, can be designated for coverage under add-on riders that address loss and destruction of these specific items.

 

Claim-Free Customers Land the Best Rates

Insurance costs are based upon risk, which is evaluated by each provider before homeowner’s policies are issued.  Customers with claim histories naturally present greater risk, because the future is likely to reflect the past, leading to costly claims on home policies.  To secure the most favorable terms, bring a responsible history to the table and maintain a safe record with your insurance carrier.

Higher deductibles also spread the risk for insurance companies, so lower premiums save money for homeowner’s willing to raise their deductible amounts.  When incidents do occur, you’ll pay more money out of pocket, but the premium savings may prove worthwhile in the long run.  To further savings, take advantage of any discounts offered by your insurance company.  Bundling several policies with the same company, for example, results in customer loyalty discounts, at times.  And installing safety devices like security systems and carbon monoxide detectors also qualifies for reduced insurance premiums with some carriers.

Tom
 

Arnel Ariate is the webmaster of Money Soldiers.

Click Here to Leave a Comment Below 8 comments
Nick | Millionaires Giving Money - September 15, 2014

I always shop around for the best policy and then use cash back sites to get money off. I know some people who have had their car insured for free after the cash back! Good post, thanks for sharing.

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Keara Littner - May 22, 2015

I’ve been wondering if there’s anything I can do to save a bit on home insurance. It makes sense that having a higher deductible would reduce your premiums. I’d just have to hope for nothing to happen that would require me to actually pay that higher deductible.

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Gary Puntman - June 16, 2015

I’m sure I would be able to save some money on my homeowner’s insurance. It sounds like I will have to make myself more informed on insurance. I agree that this is one of the biggest ways to save yourself money.

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Emily Smith - August 5, 2015

My husband and I are hoping to buy a home this year. We are hoping to understand homeowners insurance a little more before we start the house shopping process. It is good to know that it is pretty easy to compare quotes online these days. We will have to try that!

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Jackson Willis - August 7, 2015

It\’s definitely interesting to see the way that something like this can affect the way we do things. Hopefully people will be able to understand as much of this information as they can. It can definitely be really significant to be able to save money on insurance. Especially considering how much is spent on it, like you pointed out at the beginning of this article. Hopefully Everything will work out well and we\’ll all be able to understand the way this works.

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bryan flake - August 11, 2015

It sure does make a lot of sense that if I don\’t have a history of claims, that I would get a cheaper homeowners insurance rate. No company wants to pay out to a customer that is just going to use their money endlessly. The money for insurance is there as a cautionary need, not discretionary.

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Correy Smith - August 19, 2015

That\’s great to know about the 2 aspects in which a homeowners insurance will cover. Is there a limit as to how much belongings an insurance like this will cover? It\’s something that came to my mind after seeing how much valuable things I have in both the garage and the basement.

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Brandon Roberts - August 25, 2015

I definitely feel like it is important for people to understand what kind of things they can do to save on home insurance. Paying for home insurance can be a struggle sometimes. But if they were to do certain things, like the things you talked about, they would be able to save a ton of money on it.

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