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Friday, 10 June 2011

4 Ways to Save On Home Insurance

Buying a home is one of the most important investments you'll make in your life. It's also the most expensive investment you'll make in your life. But more importantly, it's where your children grow up and where you spend the most cherished times with your family and friends. A home insurance package allows you to protect your investment but also your family. And while home insurance isn't cheap, there are ways to make it more affordable.
 
1. Raise your deductible 

A deductible is an agreed-upon sum of money that someone with an insurance plan will pay the insurance company before the company will pay a claim. For instance, if your home insurance has a $500 deductible and you experience some flood damage, you will have to pay the insurance company the $500 in order to have your claim paid.

With home insurance, as with other kinds of insurance, an increase in your deductible amount can often result in a decrease in your insurance premiums. If your deductible is set at $1000 you will likely pay a higher monthly premium than if your deductible is set at $5000. Thus, a way of saving monthly is to increase your deductible. Of course, if you were to experience a claimable event in the short-term, such a plan of action would not be in your best interests. However, if you are fairly certain that you will not need to make a claim in the near future, you will likely save some money by decreasing your monthly premiums while increasing your deductible.

2. Do not insure your land

While your land does have value, it is unlikely that anything will cause it damage that is significant enough to require insurance coverage. Your home, on the other hand, has value and is at risk. When calculating the amount of coverage you need, do not include the value of your land into your calculations. Keep in mind that it is only the house and its contents that you need to insure. This tip could save you a large chunk of change.

3. Consider home security

Some insurance companies will offer discounts to homeowners who invest in security devices for their home. This is not just a good idea because it will reduce your premiums, but also because it will provide your family with added safety. Smaller items like burglar alarms and heavy-duty locks will bring small deductions, while larger one-time investments like complex home-security systems will bring substantial deductions.

4. Stick with your insurer

Long-time customers will often benefit from reduced premiums over time. As you begin to develop a sense of trust with your broker, you may be offered reduced rates. Talk to your broker about whether you can make the best of your customer loyalty!

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