When you’ve bought your dream home and finally own it, the next step to making it a good investment is home insurance.
What is home insurance?
Homeowner’s insurance, also known as HOI, is a type of property insurance that covers all types of private properties and dwellings. Depending on its qualification, homeowner’s insurance depends on certain factors that must be considered to determine if the current homeowner can qualify when applying for insurance.
HOI covers insurance on the dwelling, furnishings, loss of use or other damage and includes the personal effects of the homeowner. It may include liability insurance to cover accidents that may occur on the premises specified in the policy.
Why is this important?
Homeowner’s insurance covers any damage that may occur in or around your home, as stated in the policy. The HOI may also cover repairs and damages needed in the event of a disaster or accident, such as fire, tornado, hurricane, burglary, earthquake or flood. In most cases, mortgage companies require an HOI before granting a loan if the current homeowner plans to purchase a new home or refinance. Mortgage companies look for this type of insurance to ensure that the person will receive the amount owed in the event of a loss or damage of this type.
How do I apply for home insurance?
Applying for home insurance is like buying a new home. In some ways, people can have a difficult time if they don’t get it right. However, if one is familiar with qualifying for and purchasing home insurance, it can be a simple task.
According to a study conducted in the U.S., approximately 64% of American homes were declined by insurance companies. This means that these U.S. households were not insured enough to properly pay for or repair damage or loss to their property in the event of a natural disaster or accident.
Strategies for saving money on home insurance
Finding ways to save money can make good financial sense. The problem is that it’s not always easy to find that “saving secret”. This is especially true for insurance premiums. Insurance rules change from company to company, so it’s hard to know exactly how to save money on premiums. I’m in the same situation as you. I want answers. So I set out to find the secret to saving money on home insurance.
I spoke to our licensed insurance agent, who gave me 10 strategies for saving money on home insurance premiums. Note that they vary from company to company. We always recommend that you contact your insurance agent before spending money on upgrades. You can also get quotes from insurance agents who can get quotes from over 15 insurance companies and look for insurance companies that offer lower premiums with these upgrades.
1. Wind Protection
Credit Some insurers will give you a wind protection credit if your home is older than 2002 and you have a modern roof, or newer than 2002. To qualify for this credit, the home must be inspected by a certified wind inspector. If you pass the inspection, the inspector will give you a certificate stating that your home can withstand strong wind gusts. If you live in Florida, insurance companies are also required to offer lower premiums if certain wind protection features are present. Some of the features inspectors will look for when inspecting your home include concrete block construction, gable end reinforcement, the presence of a hipped or shed roof, secondary waterproofing, and protection for shutters and openings. Wind protection credits alone can save up to 45% on home insurance.
2. Fire and Burglar Detection System Credits
Some insurers offer credits when fire and burglar detection systems are centrally managed. This includes the installation of a fire or burglary detection system that alerts the local fire department, police, or another monitoring centre if triggered. It may also be useful to install sprinklers. These systems are not inexpensive, so it’s a good idea to start by checking with your insurance company to see if there are any discounts, how much they cost, and what products and services are considered “safe.” Then check the prices and make sure the discounts offset the costs. You can also ask about discounts for fire alarms and door locks.
3. AARP, AAA and Retiree Discounts
If you are a member of AARP or AAA or are considered a retiree, you may be eligible for a discount from your insurance company. Most insurers already offer a retiree discount based on age, but it’s always a good idea to ask your insurer if they offer this discount and if you qualify. When purchasing insurance, always indicate that you are a member of the AARP or the AAA. If you do not join until after the policy begins, call us and ask for a discount.
4. Certified Contractor Discount
If your home was built by a certified contractor, you may be eligible for a discount from your insurer. A licensed contractor is a company that has been deemed reliable by the insurance company. Each insurance company has its own list. In most cases, a discount must be given for a newly built home. Not all insurers offer this discount, so check with your insurer. If you are planning to build a new home, contact your insurance company for a list of approved builders. You will save money in the long term if you do it this way.
5. Good credit
More and more insurance companies are offering discounts based on creditworthiness. If you have a good credit history, you are more likely to save money on your home insurance. It is a good idea to check your credit several times a year with different credit bureaus. Make sure the information is correct, and if not, take steps to dispute credit applications. As a general rule, keep your credit balance low, pay your bills on time and don’t borrow more than you really need.
6. Discounts for multiple policies and repeat customers
If you buy home insurance along with other insurance, such as flood or auto insurance, you can get a discount on multiple policies. If you have two or more policies with the same insurer, you can save between 5% and 15%. Check the price first to see if it’s better to buy multiple policies than individual policies from other insurers. You may also get a price reduction if you are a repeat customer and have been insured for a certain period of time. Check with your insurer to find out if such discounts exist and how you can take advantage of them. If you have been insured for several years with the same insurer and receive a regular customer discount, find out if there is also a multi-contract discount.
7. The value of the house and the entire property
Some people make the mistake of insuring the entire property and not just the part that could be damaged, i.e. the structure(s) itself. In the event of a hurricane or tornado, the land will not be damaged by wind or flooding. Insure against the cost of rebuilding your home and replacing valuables.
8. Increase your deductible
Many insurers recommend a $500 deductible. However, if you increase your deductible to $1,000, you can save up to 25% of your premium. The deductible is the amount of money an insurance company must pay before a claim is paid. Keep in mind that different types of insurance require different deductibles. For example, in areas where hurricanes are common, a separate deductible may apply to wind damage, in areas where earthquakes are common, a separate deductible may apply to earthquake insurance, and in areas where hailstorms are common, a separate deductible may apply to hail damage. Consider all possibilities and, if you decide to increase the deductible, be sure to leave at least that amount in an emergency savings account.
9. Check insurance limits
We always want to insure all of our belongings. However, sometimes valuables lose value, and what was worth $5,000 three years ago may be worth only $3,000 today, and you no longer need to pay a premium. Check the actual value of your valuables and see if the floater insurance can be reduced or cancelled. Floater insurance is supplemental insurance for valuables that are not covered by regular home insurance, such as computers and other expensive technical equipment, expensive jewellery and valuable artwork.
10. Like any good consumer, you should look around to save money.
The easiest way to find the cheapest home insurance is to look for an independent insurance agent. Who represents a large number of insurance companies. If an insurance agent can offer quotes from 15 or more insurance companies. You are more likely to get a better deal if you go to a smaller agency. That can only offer five companies. Home insurers often target certain geographic areas and offer lower rates there. Insurance coverage is the same for everyone. All insurance companies offer different coverage than others. The only differences are service and price. Getting quotes from several insurance companies can help you get the best possible price.
About Author
Lily Poole is a Property and Home Insurance officer by profession. She is pretty well experienced in the best renters insurance nyc and accounting field and has an impressive profile in the training and development industry.
