Image via WikipediaI am coming up on my homeowners insurance renewal time. Going through Money Magazine I found a great check list of ways to save money on your homeowners insurance. My insurance went up last year 20%, quite a leap. I was glad to have it because it is hard to get insurance in South Florida with all the fears of hurricanes.
It's so bad many companies have bailed out of the state or are just refusing to write new policies. It was back after Hurricane Andrew when I had State Farm insurance. Just four years after, I missed a premium and they dropped me. They would not take me back even though I had my car insurance with them. Also multiple vehicles and equipment insured with them under my company. They had no loyalty to me even though I had coverage with them for the last 15 years.
Choosing Homeowners Insurance, just like all business decisions, comes down to dollars and cents. So for you and me, we must also do what's right for us. Here are 5 tips to help in your adventure in purchasing your homeowners insurance.
A Homes History Matters.
If your shopping for a new home it may seem unfair but claims associated with the property before you by it can result in your paying more than you would otherwise. Certain locations may be more prone to certain kind of claims.
To get past info on claims ask for a copy of the homes CLUE (Comprehensive Loss Underwriting Exchange) report. this will show all past claims. The homes past history of claims will impact all future insurance rates. If you like the house and purchase it you will be stuck with it's history. This could work in your favor because if the report is negative you could negotiate a lower price for the home.
Small Claims Can Cost You Money.
Go with the highest deductible you can afford and use the savings for all minor repairs. If you file a claim for every broken window or leaky pipe you can drive up your premiums 10 to 15 percent. Insurance agents say even just inquiring about a claim can raise red flags. Increasing you deductible from $500 to $1000 can substantially save you money on your premium. Check with your insurance agent for quotes of insurance with higher deductibles.
A Bad Reputation Can Cost You Higher Premiums.
When insurance agents give you an insurance quote they tap into the Comprehensive Loss Underwriters Exchange to see your relationship with past insurance companies. They want to see your history of past claims. To many claims raises a red flag and may increase your premiums.
You can check your insurance report for errors at Choicetrust.com, it's free if you have been denied coverage, otherwise it costs $19.95.
You May Have to Much Coverage.
You may have an inflation-protection clause in your policy. This automatically increases your premium with inflation rising. This adjustment may be erroneous. Switch it off and keep an eye on your home value yourself. Sometimes the costs of replacement could be less than when you originally purchased the policy. You could of paid a premium for your home, way above the actual replacement value. Check on your actual replacement cost and lower your premium.
Loyalty is Overrated.
Insurance companies that are associated with banks may be using you to make up for losses in the banking part of the company. Remember insurers are still competing for your business. You may be able to get a better deal as a new policy holder than as a existing one. When it's time to renew check Insweb.com and Netquote.com to see if you can get a better deal. Try to bundle it with your car insurance company, you may get a premium cut of 5% to 15%.
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I agree. Go with a high deductible and fix minor issues yourself rather than getting the insurance to pay for it - to avoid a premium hike.
ReplyDeleteAlways shop around.
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