When shopping for home insurance, there are a number of ways to reduce your premiums. Increasing your deductibles, changing coverages and selecting lower limits can all lower how much you pay for your insurance policy. These are just a few of the ways you can lower your home insurance premiums. If you're about to buy a house, here are four other ways you can get lower home insurance quotes on a policy for your new home.
Get Home Insurance Quotes Before You Purchase a Home
You'll need to have a home insurance policy in place at closing, but you shouldn't just pick the first one you come across and plan on shopping for lower quotes later one. Even though there's a lot to do when purchasing a home, you ought to take the time necessary to compare home insurance quotes and select the best option before you purchase your home.
When calculating quotes, home insurance companies in most states take into account your FICO credit score. (Maryland and Massachusetts don't let home insurers consider credit scores.) Thirty percent of your credit score is your amounts owed, and 10 percent is your new credit.
Taking on a mortgage will significantly increase both of your amounts owed and new credit -- and thus affect 40 percent of your credit score. If you wait until after you take out a mortgage to compare home insurance quotes, you might find that companies are giving you higher quotes because your mortgage has lowered your credit score.
Have New Deadbolts Installed on All Exterior Doors
Anytime you purchase a home, it's a good idea to have new locks installed on all exterior doors because you don't know who has a key to the current locks. Make sure all the new locks you have installed are deadbolts. Deadbolts not only provide better protection than other kinds of locks, but they also may qualify you for a home insurance discount. According to the Insurance Information Institute (III), having deadbolts may qualify you for a 5 percent discount on home insurance.
Negotiate to Have a Sprinkler System and Security System Installed
The III also says that an advanced sprinkler system and a security system that automatically notifies authorities can get homeowners even bigger discounts on their home insurance. In some cases, insurance companies will offer a discount of 15 to 20 percent for the right system.
Such systems aren't usually included in home sales unless their already installed in a home. You're free, however, to ask the homeseller to have such a system installed.
During the negotiation period, point out the potential risks of fire and theft, and see whether they'll have a high-end system installed prior to closing. They'll probably refuse your request, but a motivated seller might be amenable if it means they can sell the home quickly. If they do, you could be saving up to one-fifth on your home insurance every year that you own the house. There's no reason why you can ask and see if they'll help you get this discount.
Compare Quotes with an Independent Agent
Most important of all, you should compare several different home insurance quotes before you select a particular policy. Even if you're pleased with your current home insurance company, don't assume that they'll have the best policy for your new home. Every insurer weighs the risks of insuring each home differently, which is why each home insurance company has a different rate for any particular home. Your current insurer might have the lowest rate for the home you're purchasing, or another company might be able to give you a better home insurance quote.
The easiest way to compare multiple quotes from different companies is to shop for a home insurance policy with an independent agent. An independent agent isn't linked to any one insurer, so they can get you home insurance quotes from your current insurance company as well as any other insurer serving the area where the house you're purchasing is. Check out a company like East Tennessee Mutual Insurance to get started on your search.
After we purchased our first home, we realized that it might be a good idea to evaluate our insurance coverage. Although we had purchased homeowners insurance before, we had never owned a policy as large as the one we would need for our new place. Also, our new home had a trampoline and a swimming pool, which made us worried about liability. To iron out the details, I decided to meet with our insurance agent. We talked about things like monthly premiums, coverage limits, and deductibles, and it was incredible to learn more about the terminology. This blog is designed to help you with the same types of questions.