How to save money on home insurance costs without cutting coverage

Whenever people start looking at their budget for places to cut back on costs, insurance seems to fall in the same category as, the cable bill, and Starbucks. It’s nice to have, but how much is too much?

Insurance is invisible so it’s hard for most people to see the value or importance of it. But it is often the only thing people will have to spare them from a financial emergency or catastrophe.

Here are my top 5 ways to keep your insurance efficient.

  1. Discounts. Let me get this one out of the way first. Every insurance company sells their insurance by promising more discounts. While every company will have some unique discounts, bundling your home and car insurance has the biggest discounting factor. Ask your insurance advisor about all of the discounts available, even if you don’t qualify for them all. At least you’ll know.
  2. Carry a higher deductible. Claims cost the insurance company money even if they deny the claim or if the loss does not exceed the deductible. When you have a higher deductible you are less likely to file a claim on a small loss. When the risk of paying for small losses is put on you, the insurance company will reduce the premium because the larger losses are much less likely to occur.
  3. Be prepared. If you follow the high deductible advice you should have a savings account, or at least an emergency fund of $1,000 to $5,000 dollars. Think about it. You will to have only a few insurance claims in your lifetime, yet you will probably have many financial emergencies. Save on your premium by carrying a high deductible and commit the money you will save to your emergency fund.
  4. Loss Prevention. Home insurance is not a maintenance plan. Your house is going to wear out. The roof is usually the first thing to go. This is the number one, most common claim filed by homeowners. Your roof is exposed to the elements 24 hours a day. Have it inspected every 3-5 years to make minor repairs that will extend its life and delay your need to file a claim.
  5. Review your insurance plan. I know, who wants to talk about their insurance? A meeting with your insurance advisor every other year will help you stay familiar with the coverage you are paying for. It also keeps your insurance company updated on any changes that your policy needs to address.

The information contained in this page is provided for general informational purposes only. The information is not meant as professional or expert advice, and any reliance you place on such information is therefore strictly at your own risk.

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