|
Here are some factors to consider when purchasing home insurance. All
of these factors can and will have an influence on the price you pay for home
insurance.
The Condition of the Home
Insurers factor in general wear and tear on your home when setting a premium. They will
inspect such things as the condition of the roof, porches, decks, and the integrity of the
home's wiring system. Because new homes tend to be in better condition than older homes,
some insurers will offer up to a 15 percent discount if your home is new.
The Construction of the Home
Certain types of homes are less expensive to insure because they are more resistant to
damage. For example, a brick home is preferable because of its resistance to wind damage.
Safety Factors
Many insurers also offer discounts of approximately 5 percent for safety features such
as burglar alarm systems, deadbolts, window locks, smoke detectors, and sprinkler systems.
You may also receive a discount if your home is in close proximity to a fire department.
If There is a Smoker in the Home
Because smoking in the home greatly increases the risk of fire, some insurers will offer
a discount of about 2-5 percent if no one in the home smoke.
Is the Home in a High Risk Area
Flood and earthquake damage is not covered by standard home
insurance policies. Special supplemental catastrophic policies that cover these
conditions are available, but can be quite costly. If you are currently covered against
these catastrophes through a government plan, however, research coverage through a private
insurer. It may actually be lower.
Type and Amount of Home Insurance Coverage Needed
Homeowner's insurance typically covers damage or loss to your home and its contents, but
some packages also provide other benefits such as personal liability coverage if someone
is injured on your property or theft insurance. Read the fine print. Prices and coverage
can vary significantly between packages that appear similar. Make sure you get what you need
and use what you get.
Your Desired Deductible
The deductible is the amount that you the policyholder must pay before your insurance company
starts paying benefits. The higher your deductible, the lower your home
insurance premiums. By raising the deductible, you can save up to 50 percent of the cost
of your homeowner's insurance.
Loyalty to Your Company
Insurers will often reduce their rates if you buy more than one type of coverage such as
auto and homeowner's from them or if you stay with them over a period of time.
Is There a Retiree Living in the Home?
If you are over the age of 55 and retired, check with your insurer to see if you qualify
for a discount. Most insurance companies offer these discounts because retired people are
home more and can spot fires sooner than working people and have more time for maintaining
their homes. Some insurance companies will
offer discounts of up to 10 percent to seniors who qualify.
Group Discounts
As with other types of insurance coverage,
you can often obtain better home insurance rates if you get coverage through a group plan.
Check with your employer, alumni association, or other affiliations to find out if they offer
group coverage. |