Homeowner's insurance is a type of property insurance that protects your home and its contents. If a natural disaster occurs, such as a tree falling through your roof, you file a claim with your insurance company and the majority of the cost to repair your home is covered. Similarly, if goods inside your home are stolen, you pay a deductible to the insurance company and the insurer reimburses you for the value of the stolen property. Researching companies, maintaining a high credit rating and being loyal to one insurer can all help you lower your homeowner's insurance premiums.
Step 1
Contact your state's insurance regulator to learn about the various companies that provide homeowner's insurance in your area. The Federal Citizen Information Center's (FCIC) "Consumer Action Handbook" offers an online list of each state's department of insurance (see Resources). Among the information you will want to know are the companies' rates for premiums, as well as frequency of complaints. Getting a lower rate on your premium is only beneficial if you receive a high level of customer service as well.
Step 2
Lower your homeowner's insurance premium by using the same insurer for both your home and other policies, such as your car insurance or life insurance. According to the FCIC, many competitive companies will offer their customers a multiple policy discount. Becoming a long-time, trusted customer may also lead to a decrease in your premium rates over the years.
Step 3
Talk to your insurance representative about increasing the deductible you'll pay in the event that you need to file a claim against your home or its contents. Higher deductible policies can drop the cost of the premium by as much as 25 percent in some cases, according to HUDClips.org, a resource for both buying and selling real estate.
Step 4
Strengthen the security of your home. Install storm shutters that protect against hurricanes and other inclement weather, and make sure you have functioning smoke detectors. Upgrade the door locks to include deadbolts, and consider shopping for a home security system. The more you protect your home from both natural disasters and unwanted predators, the likelihood of filing a claim decreases. The FCIC reports that some insurers offer discounts ranging from 5 to up to 20 percent when protective devices of this kind are installed.
Step 5
Prove your trustworthiness through your credit scores, and you may be eligible for a lower homeowner's premium, explains HUDClips.org. Maintaining a high credit score by paying bills on time and keeping a low credit-to-debt ratio may result in lower rates than those of people who do not possess an impeccable credit history.
Step 6
Choose to insure only your physical dwelling, and not the land that it sits on. The FCIC explains that your land is not as much as risk for natural disasters and theft as your house is. If you insure both the building and your land, you will end up paying more for your premium.
Tips and Warnings
- In some areas of the country, additional premiums for flood, tornadoes or hurricanes may be required, and are not a part of your regular homeowner's policy. Be sure you understand exactly what your policy covers before signing a contract.
Things You'll Need
- Storm shutters
- Smoke detectors
- Home security system
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