What does someone shopping for home insurance look for in a quote? Often, a prospective client wants the cheapest insurance they can find.
Although this seems like a good strategy, home insurance packages vary in coverage levels. While removing optional coverage like extended water will definitely decrease a premium, it would not be wise as your home and property wouldn’t be covered in a flood. This choice, made in the interest of being cost-effective, would end up being a larger expense in the long run.
Take caution when comparing quotes of competing companies and make sure you’re comparing apples to apples. To save you the hassle, most advisors will compare policies side-by-side to determine which policy offers the best coverage for the lowest cost.
Don’t compromise coverage for cost
There are smarter ways to reduce your home insurance costs without compromising your coverage.
When shopping around, remember that bundling your home insurance with your other policies, such as auto and life insurance, can lead to greater discounts on all of the policies combined. Often, if two competing companies go head-to-head in comparing a quote, it is easy for one company to beat another when quoting more than one line. If you have all of your business with one company, that company is able to find you more savings. Additionally, most clients find that it’s more convenient and organized having all of their policies and billing come from one place.
When you’re in the market to buy or renovate a home, there are certain features that have an initial cost but can generate additional savings on your insurance. Installing a monitored alarm system or a backup sump pump, for example, are protective measures that get rewarded in savings by an insurance company. This is because such additions lower the risk of potential claims.
Once you’ve found your perfect policy with your chosen insurance company, make sure that all current discounts have been applied to your policies. One way to make sure you’re up to date with your discounts is to review your policy often. Many advisors pride themselves in taking this initiative and calling clients annually to initiate the review process, often leading to added savings for the client.
The claims-free advantage
Remaining claims-free opens up the possibility for more savings. A claims-free discount applies to clients who have maintained their claims-free status for ten years or more.
Additionally, some insurers have a disappearing deductible. The higher a deductible, the lower your premium. In our agency, we’ll set your deductible to the standard $1,000 and reduce the actual amount you’d pay towards a claim by $100 each year you remain claims-free. No claims for 10 years? You’ll reap the financial benefits of having a $1,000 deductible but in a loss you wouldn’t pay a cent.
The bottom line
There are many ways to reduce insurance costs while remaining fully protected from any situation that may result in a loss. When shopping for home insurance, keep in mind that a good insurance advisor would never take away recommended coverage just to make themselves seem competitive. At the end of the day, the point of insurance is to protect yourself and your assets.
Reach out directly anytime. I’d be happy to help you sort out the best home insurance coverage for your unique needs.