Homeowner Insurance

There are a lot of factors that go into determining exactly what your rates or premiums will be for your homeowners insurance policy. In order to secure the lowest rates, you have to take certain steps and make certain decisions. One of the biggest factors that determine how much you will pay every month is the deductible. Everyone knows that choosing the highest deductible will net you the lowest rates. However, is it truly saving you money to do so?

Luckily, there is a simple mathematic formula that will help you to determine whether or not a high deductible is paying off for you financially. It is estimated by most insurance experts that a claim on a homeowners insurance policy is made every 8 to 10 years. Therefore, take the following steps to determine if your high deductible and lower premiums are adding up to savings.

1) Subtract the lowest deductible amount being offered, from the highest.

2) Subtract the lowest premium amount from the highest.

3) Divide the number that you come out with in the first step, by the number you get in the second step.

If the number that you get after you do all the steps is less than 8, it makes sense to go with the higher deductible amount. Remember, getting the lowest homeowners insurance rates are only half the battle. In order to make a truly good financial move, you need to take the claim making aspect into consideration. Chances are, you will have to make a claim sometime.

Your home is your most valuable asset both in many ways. It has financial value that can be tapped into when the need arises. It also has a certain emotional value built around the shelter it provides and the family memories built around it. For these reasons it only makes sense that you need to protect it from potential harm. With this in mind you also want to save money on your homeowners insurance without sacrificing the coverage you need.

If you think your current homeowners insurance premium is to high here are 8 ways you can save money while maintaining the amount of coverage you need to protect your home.

1. Shop your current policy among different insurance companies and see who gives you the most competitive quote. The general rule of thumb is to get at least 4 quotes. This can be done quite easily these days as all the major insurers have websites that can provide almost instantaneous quotes.

2. Check your deductible and see if raising it is a possibility. If your financial situation can handle it raising it can bring significant savings on your monthly premium.

3. Get all your insurance from the same company. There is fierce competition in the insurance industry and most companies will offer discounts if you buy all your insurance needs from them. In most cases combining your home and auto insurance is a good way to save money on your homeowners insurance.

4. Ask about getting discounts for security systems, fire alarms, and fire sprinkler systems. Most companies will provide savings for these devices so it can pay to install them.

5. Accurately calculate the value of your home. Remember home insurance is used to pay for damage or to rebuild your home in the case of damage or destruction. You do not need to insure the property on which you home is built so do not use the appraised real estate value of your home to determine how much coverage you need.

6. Certain home improvements can also affect how much you can save off your monthly premium. Depending on the geographic location of your home making improvements that guard against the natural disasters that occur in your area can also lead to savings.

7. Be sure to calculate the policy limits for your personal possessions accurately. This includes floater insurance for your most valuable possessions including jewelry, art work, or any other expensive items that would be hard to replace if they were stolen or damaged.

By following these 7 ways to save money on your homeowners insurance you can get the coverage you need at the price you want.