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How to reduce the cost of homeowners insurance

How to reduce the cost of homeowners insurance

Some of the factors that affect the cost of homeowners insurance may be beyond your control. For instance, the location of the property plays an important role in the determining of insurance premiums with areas that have high crime levels attracting higher premiums. Despite that, it is important to insure your home against perils such as theft, fire and other disasters so that you do not suffer losses in case they occur. In as much as there are factors determining the insurance rates which are beyond your control, there are things you can do to reduce the cost of homeowners insurance. This will ensure that you pay lower premiums. Some of the steps you can take include:

Discounts

Discounts help to reduce your cost of homeowners insurance. There are various types of discounts such as new customer discounts, loyalty discounts for being with one insurer for long and claims free discounts among others. You can enquire from the insurance agent or company if you are qualified for any of the discounts.

Raising the deductible

Deductible is the amount of money that accrues to you in case an insured peril takes place. The rest of the money is paid by the insurance company to cover for the repair or replacement. Having a higher deductible results to lower premiums because the higher the deductible, the higher the chance that you will not make a claim. Before you opt for it, make sure that you can afford paying large amount of money in the event a peril occurs.

Policy bundling

Having all your policies with one insurer can bring your cost of home owners insurance down. Insurance companies reward those who take multiple policies with them by lowering their premiums. You could have your homeowners, life and automobile insurance with one company.

Upgrade the systems in the house

Upgrading your home systems that include plumbing, electrical, roofing and heating can lower the cost of home owners insurance. If your house has systems that are less than ten years, it is considered safer than a house with outdated systems. This translates to reduction of premiums. If you are in earthquake prone areas, you can receive discounts on your premiums if you install modern foundation in place of post and pier foundation on wood frame houses. In a hurricane prone area, you can benefit from lower premiums if you install storm windows and metal roofing that is upgraded.

Use security systems

If you install security systems such as a modern burglar system, carbon dioxide and smoke detectors, you can be eligible for a discount on your policy. It is however important to ask an insurance agent about the security improvements that qualify for discounts. Also, know the amount of discount that you will receive.

Have a good credit score

A good credit score can result to lower premiums. If your score is bad, improve it by paying debt and negotiating others with creditors.

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