If you own a home or property, you'll need to purchase home insurance to protect yourself. Without it, you can find yourself deep in financial trouble should something go awry.
But as with all types of insurance, you want to make sure you’re getting a good deal when you purchase your homeowners insurance. And for better or for worse, a lot of different things can factor into your homeowners insurance rates. It’s a little bit of a game to find the best rates for you and your home, but it can be done.
When it comes to getting the best rates, it’s less about what you do, and more about what you don’t do. Here are eight common bad decisions that negatively impact homeowners insurance rates — with a little help from car insurance
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Not reading your policy carefully
As great as insurance is, it comes from a business, and that business has a goal — to make money.
An insurance company or agent might try to sell you on lots of extra kinds of insurance that costs extra — and those costs can add up. It’s vital that when you’re signing up for a homeowners insurance plan, you read the policy all the way through to make sure that you’re not spending extra money for something you don’t want or need.
On the other hand, you'll want to carefully read through the policy to make sure you understand what isn't covered as well. If you live in a place with a history of flooding
for instance, make sure you can get some coverage for water damage. If you live in a higher risk area and think you're missing a key coverage, it might be worth getting extra coverage so you don't face an expensive surprise down the road. Having a poor insurance score
Things like bankruptcy filings, garnished salaries, tax liens, and large amounts of defaulted debt all negatively impact your insurance score, which raise your homeowners insurance premiums.
One frustrating thing about insurance scores is that most of these scoring systems are proprietary — so you can't go check on how it's impacting the quotes you're getting from your insurance agent. But if you do have any of the issues mentioned above, try to sort them out. Once you do, you can compare and switch carriers to see if you can get a better price for your premiums.
Not maintaining your home
Insurance companies generally price their policies by a simple rule: the less chance of you filing a claim, the lower your premium will be. In other words, insurance carriers tend to give "lower risk" homeowners better rates.
A home that isn’t well maintained is a hassle for home insurers. Not maintaining your home means there’s increased risk of serious damage. And while insurance companies often won’t offer payouts for claims when you’ve been negligent, they still have to go through the process of proving your negligence.
Basically, a poorly maintained older home will make you a "higher risk" applicant. And that means your premium will have higher rates that other homeowners.
Not working to raise your credit score
It’s unfortunate and problematic
that credit score dictates much of our lives and our purchases, but that's the reality. Insurance companies rely on your credit score to determine your rates. And if you have a bad credit score, your homeowners insurance rates will be higher. If you take steps to improve your credit score, you might have an opportunity to save money on insurance. Requesting a claim that you didn’t need
Every time you make a claim to your homeowners insurance company, it goes on record, and your insurance company is likely to raise your rates. Even if they don’t, the next company that you get homeowners insurance from will almost surely give you a more expensive premium than they otherwise would have.
Filling your home with items that will raise your premium
There are certain items that automatically raise a lot of homeowners insurance premiums. Two examples are trampolines and wood burning stoves. If you fill your house with items that raise your rates, you’ll quickly notice it when it comes time to pay your homeowners insurance.
Not checking for discounts
Most insurance companies offer a large number of discounts for everything from first time homeowners, to active military and veterans. Make sure to check for as many discounts as possible, so you can start to lower your rate.
Not shopping around and bundling
You'll notice that a lot of these decisions take time to fix. It can take months or even years to make improvements to your credit score or work on your home. But there's one method that can save you money on home insurance in just seconds.
When it comes to any kind of insurance, you always want to shop around, and you always want to try and bundle your home and car insurance
. For the best rate on bundling, try Jerry
. A licensed broker, Jerry does all the hard work of finding cheap quotes from the top name-brand insurance companies and buying new car insurance. Jerry will even help you cancel your old policy. And to ensure you always have the lowest rate, Jerry will send you new quotes every time your policy comes up for renewal, so you’re always getting the coverage you want at the best price.