How To Reduce Your Home Insurance Costs

How To Reduce Your Home Insurance Costs


If you own your own home, having insurance on it in order to cover possible losses is essential, even required if you have a mortgage. Losing your home to fire or suffering loss due to wind damage, water, or some other calamity can be devastating, but it doesn’t need to be financially debilitating. Let’s take a look at some ways you can insure your home and save money in the process:

Homeowners insurance should be used to cover major calamities such as fire. With a bigger deductible, you can reduce your premium while covering small expenses out of pocket.

Homeowners insurance should be used to cover major calamities such as fire. With a bigger deductible, you can reduce your premium while covering small expenses out of pocket.

Shop Around – If you haven’t shopped for homeowners insurance in some time, then plan on doing so now. Your current provider may meet your needs, but do they offer the best policies at the right price? Use a mortgage comparison tool to check several plans side by side, but don’t choose a company solely on price. You want an insurance provider who has a very good or excellent rating as determined by A.M. Best Company, a company who tracks the health of insurance providers.

Compare Policies – What sort of coverage do you need for your home? Protection against damage or loss is important and should include other factors such as theft of goods, all living spaces included a new deck, finished garage, attic, etc. Consider an umbrella policy to protect yourself in the event that you are sued too.

Insure Home & Auto Together – If your insurance company provides both home and auto coverage, you should be able to get a discount for carrying both kinds of coverage with one company. Additional discounts are possible if you have life, health or some other insurance coverage with the same company.

Loyalty Discount – After shopping around to compare plans, you may find that your current insurer is  priced in the neighborhood of its competitors. But, if you’ve been with the same company for several years, then a “loyalty” discount of five to ten percent may still be applied. Ask your insurer if your loyalty means a discount from them.

Increase Your Deductible – If you have a $500 deductible you’ll pay higher premiums than a $1000 or $2500 deductible. In effect, by choosing a lower deductible, you’re “self insuring” against smaller losses while allowing your insurance company cover major losses.

Filing Claims – The whole reason for having homeowners insurance is to cover your prized asset in the event of damage, right? Well, yes. However, as mentioned under “deductibles” you’re better off in the long run if you don’t file smaller claims. Even a call to your insurance company can trigger a rate increase while filing a pair of small claims within a few years time can jack up your rate too.

Take Inventory – You can save on insurance, but you can also improve your chances of getting a good settlement in the event of loss if you take inventory of what you own. This means taking a lot of photographs of your home inside and out, listing everything you own with close up shots of your valuables. Keep this information in a safe place such as with a friend or relative just in case a total loss of your home due to fire or tornado destroys your proof.

How much can you save on homeowners insurance? That’s hard to say. By keeping on top of what coverage you currently have and making sure that you are getting the best bang for your buck, you can contain your costs and save money year in and year out.

Adv. – Are you considering a loan modification? If so, this mortgage medication website could offer just the prescription you need to improve your financial health.


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Categories: Consumer Tips

About Author

Matthew C. Keegan

Matt Keegan is a freelance writer and editor as well as publisher of "Matt's Musings", his personal blog. Matt covers campus, consumer, business and financial topics on various websites and blogs, and has been published in the "Houston Chronicle", "Sam's Club Magazine" and "Wisconsin Golfer".