If you are in the market for a home insurance policy, getting great coverage at an affordable rate is likely a priority. You can accomplish this by following some of the best home insurance tips according to Reddit. When you have these cheap homeowners insurance tips in mind, you will be able to shop around until you find a policy that is not only suitable for your home but also friendly to your budget.
Understand how home insurance is priced
Learn about replacement cost
When people shop for homeowners insurance, many are under the impression that the insurance premiums are based on the cost of the house when you purchased it. This is false, and it is actually based on the cost it would take to rebuild the home in case a total loss is experienced.
You will want to become familiar with your replacement cost estimate. All insurance agents will run an RCE to determine how much the policy will cost, and you can ask to see this if you are curious. The report details all aspects of the home such as the foundation, roof, gutters, masonry, windows, and fireplaces. While this is not the only factor involved, it is one of the main factors.
Source: r/firsttimehomebuyer
Understand Common Causes for Rate Increases
Even when you do not file any claims, there is still a chance your home insurance rate can increase. This has to do with individual carriers and dwelling material costs. Many people wonder if this is a legal practice, and it is. Carriers have the right to increase premiums to better suit the economy, just as customers are able to shop around for better rates.
There are also times when a carrier might have to increase everybody’s rates in a given area because of natural disasters that cause many losses. When the company has to pay out a lot of money to handle these claims, they are forced to increase the rates because they need to have enough funds to handle potential future losses. If you live in an area where there are frequent storms, this is something you might notice after a particularly bad season.
Source: r/homeowners
What you can do to lower home insurance rates
Ask about discounts
Any time you are getting home insurance quotes, you should always ask the agent if you qualify for any discounts. Almost all insurance carriers offer discounts on homeowners insurance. According to Reddit, you can actually save a lot of money even if your initial rate is not particularly cheap. Many carriers even reward loyal customers and those who can remain claims-free for a given period of time.
It is always worthwhile to choose a company that provides plenty of home insurance discounts because you will likely qualify for a couple of them. This can save you a lot of money in the long run and set you up for financial success. These are some common discounts offered by home insurance carriers:
- Bundling policies
- Having fire/burglar alarms
- Having sprinklers
- Being claims-free
- Remaining a loyal customer
- Having a newer home
- Having a newer roof
- Being retrofitted for earthquakes
- Having storm mitigation set up
- Living in a gated community
Source: USAA
Increase your home insurance deductible
Something you can do to immediately lower your home insurance rate is increase your deductible. This is going to bring the cost of your premium down because you are promising to pay more out of pocket in case you must file a claim. This is something that many people opt to do because they are looking to save money right away.
If you decide to increase your deductible, this can be a great option if you have money saved in case a loss is experienced. As long as you feel comfortable covering the deductible in case you must file a claim, this can be a great way to lower your rates according to Reddit.
Source: r/PersonalFinanceCanada
Get multiple home insurance quotes
Use an insurance broker
Going to an insurance broker to get homeowners insurance quotes is a valuable tool according to Reddit. You can get a variety of different quotes to compare in an instant rather than going out of your way to research carriers independently. Brokers have quoting tools that allow them to search for rates that best suit your home with the click of a button. They have access to a multitude of carriers that are highly rated in the industry.
Many brokers do charge a one-time broker fee for their services, but this is a minimal expense when you consider all the money you can save by choosing the lowest rate out there. Brokers have the experience necessary to put you with the best carrier for your home in your local area. They can also customize your coverages to allow you to have the most comprehensive policy possible. You can also contact your broker any time you need to make changes to your policy or in case you need to file a claim. They do a lot of this work for you, giving you more peace of mind.
Source: r/nova
Compare coverage limits
Not all homeowners insurance quotes are made equal. While many of them cover the same dwelling, other structures, personal belongings, additional living expenses, and personal liability, you will still notice some differences when shopping around for policies. This is why getting multiple quotes is important.
If you are using a broker, you can ask them to break down the quotes so you understand what is being covered. Going into the search independently can mean you need to do some research to make sure you fully understand the coverage being offered. When you look at each quote, you should look at more than just the price point. The coverage is going to factor into your decision.
Source: r/Insurance
Reddit communities for home insurance tips
Reddit is full of many great tips regarding home insurance. If you want to lower your rate or shop for a new policy, it is worth checking out what Reddit has to say because this can save you a lot of money over time. You can find more information by visiting the following subreddits.
