Overlooked Ways To Save On Homeowners’ Insurance

August 2, 2008

You could be overlooking an important way to save on your homeowners’ insurance. America’s economy is forcing many households to find new ways to be thrifty. Looking at the documents give n to you by your home insurance company can yield oft-ignored opportunities for thrift.

Most people know that they can reduce their homeowners’ insurance rates by changing their policies to have a bigger deductible. However, many people don’t know how many ways there are to get credits with their home insurance provider. With these credits, home insurance providers reward people who choose to improve their homes by lowering their annual rates, without increasing deductibles. Unlike the situation in which you lower the premium by increasing the deductible, you don’t stand to lose anything by taking advantage of these credits. You only stand to benefit.

First, many insurance providers will reduce your premium if you purchase additional security mechanisms for your home. A simple smoke detector–required by law in many states–can sometimes reduce your premium by 5%. So can the addition of a basic burglar alarm, or high-security locks. Some burglar alarm systems involve cameras, or a direct line to a law enforcement agency or private security company. If you splurged for one of these more advanced systems, you might be eligible for a discount of up to 20%.

Some insurance companies, such as the Chubb Group based in New Jersey, will credit you for having a system of preventing plumbing failures. If your house has a system that detects seepage in the pipes and turns off the water automatically, the Chubb Group will offer you a discount of 2% on your home insurance premium. The insurer offers the same discount tho homeowners who purchase a system that heats up the pipes automatically when the temperature falls below a certain point, to prevent the water in the pipes from turning to ice.

If you live in an area prone to wind-borne natural disasters, you might want to invest in storm windows and unbreakable glass, in any situation. However, home insurance companies like Chubb and State Farm offer discounts for the degree to which you’ve invested in disaster-proofing your home. If you live where there are earthquakes, an emergency power generator can reduce your homeowners’ insurance premium. In regions where there are hurricanes, a roof with extra wind protection can yield reductions in rates of up to 20% from State Farm, depending on how much extra protection the roof offers.

Home insurance companies now also offer reduced rates to people who live in protected communities. If there’s a gate and a security company guarding a complex of homes, the Chubb Group will offer a rate reduction of 5% for covering a home within that complex. If you’ve renovated or upgraded your home recently, you might also stand to gain a break. In short, home insurance companies are trying to respond to the recent housing crisis by offering new ways for homeowners to save money.

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