The average homeowner in Alabama pays $1,198 per year for home insurance, according to data from the Insurance Information Institute. This sum pales in comparison to what it would cost a customer to rebuild and replace a home and contents after a disaster. It's beneficial to know where you can save money and trim costs. I'm a firm believer in paying for your coverage needs based on your specific needs and budget.
1. Bundle your home and auto insurance policies
One of the easiest ways to save money is to combine your auto and home insurance with the same company. Most of our insurers offer a discount if you purchase multiple policies from them, including Progressive, Travelers and Safeco.
Bundling auto and home insurance will typically save you 10% to 20% on your homeowners rate and auto insurance rate.
2. Secure your home
Insurance companies calculate your rate based on many factors, including how well your home is protected from threats such as fire, storms and burglary. You can reduce your risk of a claim and qualify for cheaper rates by upgrading your plumbing and electrical and by adding features like an alarm and/or fire system. I wrote a blog post about the alarm system I use - Simplisafe.
By upgrading your home and avoiding incidents, you give your home insurer less incentive to raise your rates. Some home upgrades won't be cheap, so check with us beforehand to see how much a potential upgrade will save you.
3. Other discounts
Discounts for combining your home and auto insurance, and adding home protection features may be well-known to you, but they don't stop there. Here are some other lesser-know discounts available:
Ask us about the extra discounts you could qualify for.
4. Increase your deductible
Your home deductible is the amount carriers subtract from a claim. The most common deductible is $1,000. Increasing this will reduce your rate. It will also persuade you from filing a claim for minor damages, as fixing these often costs less than the deductible. This means you're less likely to see a rate increase at renewal.
If you have funds available, this is an excellent savings option.
5. Increase your credit score
Most insurance companies use your credit score to help predict the likelihood of a claim. If you have poor credit score, your rate will be higher. If your FICO score is under 630, improve your credit by paying your bills on time, paying off a credit card, or by simply looking at your credit report and fixing any errors.
6. Review your personal property
It's smart to review your belongings and their value to see if it matches your insurance coverage. You might have higher coverages than you actually need. At the same time, you could be under-covered and higher value items such as antiques or jewelry may need to be added to your policy.
7. Let us shop around
Insurance rates differ from one carrier to the next, so it's a good rule of thumb to get estimates from the several companies we offer. Just because an insurer didn't offer the best rate five years ago, doesn't mean they don't offer a better rate today. However, loyalty discounts may be available for sticking with the same insurer year after year.
Current customers, give us a call and we will be happy to review your policies for savings opportunities.
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