Cost-Cutting Insurance Tips
1) Maintain a Security System and Alarms: A burglar alarm that is monitored by a central station, or that is tied directly to a local police station, will help lower the homeowner’s annual premiums, perhaps by 5% or more. In order to obtain the discount, the homeowner must typically provide proof of central monitoring in the form of a bill or a contract to the insurance company.
Smoke alarms are another biggie. While standard in most modern houses, installing them in older homes can save the homeowner 10% or more in annual premiums. CO2 detectors, dead-bolt locks, sprinkler systems and in some cases even weatherproofing can also help.
2) Raise Your Deductible: Like health insurance or car insurance, the higher the deductible the homeowner chooses, the lower the annual premiums. However, the problem with selecting a high deductible is that smaller claims/problems such as broken windows or damaged sheetrock from a leaky pipe, which typically will cost only a few hundred dollars to fix, will most likely be absorbed by the homeowner.
3) Look for Multiple Policy Discounts: Many insurance companies give a discount of 10% or more to their customers who maintain other insurance contracts under the same roof (such as auto or health insurance). Consider obtaining a quote for other types of insurance from the same company that provides your homeowners’ insurance. You may end up saving on two annual policy premiums.
4) Plan Ahead for Construction: If the homeowner plans to build an addition to the home or another structure adjacent to the home, he or she should consider the materials that will be used. Typically, wood-framed structures (because they are highly flammable) will cost more to insure. Conversely, cement- or steel-framed structures will cost less because it is less likely to succumb to fire or adverse weather conditions.
Another thing that most homeowners should, but often don’t, consider is the insurance costs associated with building a swimming pool. In fact, items such as pools and/or other potentially injurious devices (like trampolines) can drive annual homeowners’ insurance costs up by 10% or more.
5) Pay Off Your Mortgage: Obviously this is easier said than done, but homeowners that own their residences outright will most likely see their premiums drop. Why? The simple reason is that the insurance company figures that if a place is 100% yours, you’ll take better care of it.
6) Make Regular Policy Reviews and Comparisons: No matter what initial price you’re quoted, you’ll want to do a little comparison shopping, including checking for group coverage options through credit or trade unions, employers, or association memberships. And even after purchasing a policy, investors should, at least once per year, compare the costs of other insurance policies to their own. In addition, they should review their existing policy and make note of any changes that might have occurred that could lower their premiums.
(Excerpts taken from the Homeowner’s Insurance Guide: A Beginner’s Overview | Investopedia http://www.investopedia.com/insurance/homeowners-insurance-guide/#ixzz4ZFtRM9VS)