Home Insurance Shopper's Tips and Guide
Get Coverage You Need
Obviously, major damage to a home is rare. Still, you want to make sure that your coverage is relevant to your needs.
Are you looking to cover a second home? If so, you may want to opt for a policy that merely covers damage to the physical property and structure, rather than also covering personal belongings on the property. If it's a second home, you're probably not keeping your most prized possessions there, and certainly not the ones necessary for your day-to-day life. So, consider buying “dwelling” insurance rather than a full homeowner policy.
Increase Your Deductible
A deductible is the amount of money you will pay out of pocket before your insurance kicks in. If you want to save on your monthly premiums, increase your deductible to the limit that you could pay in the event of an emergency (but no more—if you can't pay your deductible then insurance is practically useless!).
Increase Your Credit Score
Insurers use your credit rating to estimate the risk of taking you on, so taking steps to reduce your debts will lower your rates. To start, evaluate all of your various debts and begin paying the monthly minimums. Pay off your debts from smallest to greatest, as the number of your debts is a factor, so fewer debts equals lower rates.
Combine Insurance Plans
As a rule, insurers will give you discounts for doing more business with them, so if you combine your car insurance and home insurance, you're likely to get a smaller bill for both. Be careful though—this is not always the case.
There are substantial discounts for longtime customers of insurance companies. Sticking with the same company for several years could net you a 5% discount, which continues to increase over time.
Strong Homes Are Less Risky
Reinforcing your home against the elements and natural disasters will not only reduce the damage your home endures during inclement weather, it will also signal to the insurance company that you are a lower risk and your policy cost will go down. (Make sure your insurer will translate your improvements into discounts before you pay to have them done. Generally they will.)