Homeowners insurance can be a costly investment, especially when rates tend to increase every year, based on factors that are often out of the homeowner’s control. At Summit Insurance Advisors, we try to inform our customers about the factors that go into determining a premium, and we often suggest that they take steps to reduce their homeowners’ insurance premiums when they can.
Factors in Determining a Homeowners’ Insurance Premium
- Areas of Coverages Included. There are several areas of coverage. They include: Damage to House, Other Structures, Personal Property, Additional Living Expenses, Comprehensive Personal Liability and Medical Expense. Some companies offer house or hotel rental if your home is damaged or needs to be rebuilt.
- Types of Coverages Included. Some policies cover the actual cash value of the home, which covers the depreciated value of your home and contents; the replacement cost is the actual cash value without the deduction for depreciation; the guaranteed or extended replacement cost is whatever it costs to replace your home, or a percentage above your coverage to replace your home.
- Does the Home Have a Pool? An insurer may deny coverage if you have an empty pool; they will likely demand that it is filled or covered. You’ll likely need a strong fence too, before you’ll get coverage.
Ways to Lower Your Insurance Premium
- Raise Your Deductible. When you agree to pay more out of pocket if something happens, they’ll charge you less over the year because you’re assuming more risk.
- Add a Security System. Many insurance companies provide a discount for homeowners who have made their homes more secure and resistant to burglary.
- Buy Homeowners and Auto Insurance from the Same Company. Many companies offer discounts if you purchase multiple policies through the same company.
To learn how Summit Insurance Advisors can help you lower your premiums contact one of our professionals for more information today.