Homeowners insurance costs vary widely. Thanks to the increasing number of natural disasters happening nationwide, bigger claims and rising construction costs, average premiums are on the rise. But don’t worry. Don’t let the perceived cost of insurance prevent you from keeping your home and your family safe. There are plenty of ways to save money without sacrificing coverage.
Before you buy an insurance policy, you should always compare quotes. And only select the coverage you need. Insurance companies often offer a range of discounts and credits, which could reduce your premiums by as much as 25%. Discounts may be combined to show a larger amount of potential savings.
Insurance companies aim to cut premium costs for nearly anything that lowers your risk profile. Check out some of the discounts and credits below and see if there’s a way to spend less money on your monthly premiums.
Bundled policy discount
Insurance companies often offer companion policies, also known as a bundled policy. Luckily, many carriers allow you to take advantage of this discount even if you don’t purchase all your policies through them, which dispels a common myth that the only way to obtain a bundled discount is through a single carrier. For example, you can select the best car insurance provider for your auto policy and best home insurance provider to financially protect your property, asking both to include their bundled discounts (once they verify that you have an active policy with another carrier).
All carriers that offer this discount to their clients for multiple products within their company should be able to offer you a similar discount from your selected carriers. New insurers like Hippo are able to build in discounts like companion policy into their base pricing, so the savings are already included. Do your research before committing to a single carrier due to bundling discounts, the savings may not be as drastic as you think.New insurers like Hippo are able to build in discounts like companion policy into their base pricing, so the savings are already included. Do your research before committing to a single carrier due to bundling discounts, the… Click To Tweet
Potential savings: About 15% (from bundling home and auto insurance)
Early signing discount
When it comes to homeowners insurance, it pays to be proactive. If you have a home or condo, you could save money and qualify for a discount by securing a new insurance policy before your existing one expires or you close on your new home. Most insurers, like Hippo reward customers for signing up for home insurance 8 or more days before they need their policy to start. So think of it as a bonus for crossing an item off your to-do list a week early.
Potential savings: About 10%
New home discount
Because you won’t have to worry about wear and tear with a newly constructed home, you won’t have to pay as much money to insure it. New pipes are less likely to burst, new furnaces are less likely to malfunction and new electric wires are less likely to catch fire. And homeowners with new homes are less likely to end up with costly claims.
Potential savings: As much as 30%
Smart home discount
Insurance providers love smart home devices. They increase energy efficiency and help protect homes. More importantly, they can detect issues before they happen, minimize damage and lower the number of claims policyholders file. High tech gadgets like smoke detectors, alarm systems and water leak detectors can help you score big discounts. The amount you could save will depend on the number of devices you’ve installed.Smart home devices can detect issues before they happen, minimize damage and lower the number of claims policyholders file. High tech gadgets like smoke detectors, alarm systems and water leak detectors can help you score big… Click To Tweet
Potential savings: Between 5% and 15%
You know those auto insurance commercials where they promise a discount for good drivers? The no-claims discount offers homeowners a similar deal. It trims premiums for policyholders who go a certain number of years (such as 10 years) without filing a claim. Why? Fewer claims means more money in your insurer’s pocket and some companies are willing to pass those savings onto their customers.
Potential savings: As much as 20%
You could save money by paying for your home upfront. Just like banks, insurers consider you less of a risk if you’re mortgage-free. It signals that you’re a financially responsible (and wealthy) person. You’ll also have more of an incentive to maintain and protect the property than someone who only owns a small percentage of their home.
Potential savings: As much as 10%
Affinity group discount
If your alma mater, cable company or even employer pairs up with a home insurance company, the partnership may give you access to an affinity group discount. If you already have an insurance provider, check their list of partners to see if you’re involved with any of the participating groups. In addition to discounts, insurers sometimes provide special perks, like lifetime renewability or rates that are locked in temporarily.
Potential savings: Between 5% and 20%
Homeowners association (HOA) fees contribute to a master insurance policy that covers shared real estate (think: community pools and gyms). The master policy won’t insure your dwelling, but it could help you get a discount on your own policy. HOAs usually have strict rules, community standards and a neighborhood watch. That means your home is well-maintained and safer from theft or vandalism, which providers will reward with more affordable premiums.
Potential savings: Between 5% and 10%
Fire extinguisher discount
Small protective devices can also help you save money on insurance premiums. For example, just owning a fire extinguisher may be enough to lower your insurance costs. It can put out a small fire or suppress the flames while you escape. The National Fire Protection Association recommends having extinguishers at home that are accessible. It may cost more, but look for a rechargeable ABC-rated model with metal valves. That way, you won’t have to continually buy disposable fire extinguishers and you’ll be prepared for any type of fire.
Potential savings: As much as 5%
Gated community discount
Living within a gated community offers privacy and peace of mind. It also provides an extra layer of security that insurance providers will reward you for. You need a code to access homes within gated communities and the entrances are usually guarded with officers or cameras that monitor the neighborhood. This makes your home a lot less attractive to thieves. And compared to a homeowner living outside of a gated community, your chances of needing to file a criminal activity claim or request an insurance payout will be smaller.
Potential savings: Between 5% and 20%
Other ways to save
Many insurers offer discounts. But they don’t all provide the same discounts. And not all providers will tell you about these cost-cutting credits up front. You’ll have to check with insurance companies in your area to see what discounts they offer and how you can qualify. (To save some time, consider the fact that Hippo offers all of these discounts.) As long as you can prove that you meet the requirements for certain discounts, you’ll pay less for insurance coverage.
The way you pay can also help you save. You could get a small discount if you set up your premium payment as an automatic deduction from your bank account or pay the total amount all at once in the beginning of the year. If premiums are still too high, consider bumping up your deductible, which is the amount you agree to pay out of pocket for covered damages and losses before your insurance plan kicks in.
You should also call your provider and let them know if you got married, quit smoking, raised your credit score or retired from the workforce. Each of these life events can help you score some extra discounts on insurance. Want to save even more money? Check out the list of home improvements and upgrades that can lower your insurance premiums.
Still have questions about which discounts you’re eligible for with your home insurance provider? Contact a Hippo specialist. We’re here to help!