Excalibur Insurance Group

15 Things to Look for When Trying to Get the Lowest Possible Premiums on your New Home

Lots of different factors go into making up an insurance premium. Here are 15 that you can use to make sure you end up paying the best possible premium for your home.

  • Age – Older homes have more risks associated with their structure. So, unless the previous owner has done some major renovations to improve the structural integrity of the building, you’ll end up paying more.
  • Types of Wiring – Some older homes were built with aluminum wiring, which is not just an insurance risk, but also a significant fire hazard to you and your family. Many companies outright refuse to provide coverage for these types of homes because it’s so dangerous. If you want to buy a house that has aluminum wiring consider having it changed, or expect to see your premiums go through the roof.
  • Type of Heating – While it will depend on how recently the heating system has been upgraded gas, propane, and electric heat are usually the least expensive to insure. Oil heating can be marginally more expensive, and typically you can expect that having a wood burning fireplace or stove will significantly increase your premium.
  • Size Matters – If you have a larger home, your home insurance premiums will be higher, this is because the cost to replace the structure and everything in it will typically be more expensive.
  • Location – “Location, location, location” having a beach or lakefront may property sound great, but can put you at a higher risk of flooding which will make your premiums go up.
  • Proximity to a Fire Hydrant or Fire Hall – If your home is hours away from the nearest hydrant or fire station it runs a much higher risk of burning to the ground. If you want a lower insurance premium, your best bet is living where help is just around the corner.
  • Your Credit History – Having a better credit history may mean lower rates with some companies.
  • Your Claims History – While many claims can be chalked up to “bad-luck” sometimes a more substantial claims history can be a result of neglecting property maintenance. If you’ve had to file a claim in the last five years, your home insurance rate will likely be higher than someone who hasn’t had a claim.
  • Smoking – Not only does smoking hurt your home’s value (by approximately 30% per a recent study), it only takes one lit cigarette to burn your house down.
  • Other Factors – Any pools, ponds, detached garages, or other structures can increase your insurance premiums. Each free-standing structure or amenity comes with its own risks and increases the home’s value.

5 Ways to Save Money on Your Premium with the Home You’ve Already Got

  • Installing a Home Security System – These handy devices not only help to deter burglars, while keeping you and your family safe, but they can also get you a discount on your home insurance. Some companies offer more of a discount than others, but you should expect to save up to $150 a year on your home insurance, by merely installing a home security system.
  • Home Upgrades – Not every home upgrade will lower your premium, but any improvements replacing potential hazards in structure, heating, or wiring should lower your costs
  • Paying Off Your Mortgage – While this isn’t an easy task, it can significantly reduce your home insurance premium. Most insurance companies assume that if you own your home outright, you can afford to take better care of it, lowering your risk and therefore your premiums.
  • Raising Your Deductible – Your deductible is the out-of-pocket expense you pay when making a claim. Standard home insurance policies typically have a deductible starting as low as $500 or $1,000. You’re not likely to make a claim for $500, so why not consider raising your deductible? By increasing your deductible, your yearly or monthly premiums will go down. If you raise your deductible to as much as $2,500, you could substantially lower your premiums.
  • Paying Annually – Many insurance companies charge administrative fees every time you make a monthly payment. While these service charges may not seem extreme, the costs can add up over time. We recommend switching to an annual payment plan to save money.

Have you bought a new home? Try our online Rate Reducer to compare 10 insurance quotes in minutes or give us a call at 1-888-298-7343 to speak to one of our licensed brokers about your options.

Authored By Sydney Wettlaufer