How To Save on Rising Home Insurance Premiums
Homeowners insurance premiums have risen dramatically from last year. Luckily, there are still ways you can save.
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According to an analysis by insurance marketplace Policygenius, the average home insurance premium increased 21% from May 2022 to May 2023. In some states, the increase was 30% or more. The report noted that home insurance price increases are expected to continue due to a an increase in U.S. natural disasters, as well as increasing construction costs and labor shortages.
In 2022, insurance companies paid out $99 billion in damages due to natural disasters, which is the fifth most expensive year on record for insurance losses, the report explained. Residential construction costs are also up 34% since March 2020, according to the U.S. Bureau of Labor’s Producer Price Index, due to inflation, supply chain concerns and labor shortages.
“To help pay for it all, insurance companies appear to be passing more of these costs onto customers than ever before,” wrote Pat Howard, a home insurance expert at Policygenius.
Experts say there are several ways you can save on your home insurance costs, according to Buy Side from Wall Street Journal.
Get Multiple Quotes
Compare insurance companies and get quotes from other insurers before making a commitment. You can also turn to an independent insurance agent to shop around on your behalf and recommend the best policy that matches your budget. Buy Side noted that most independent insurance agents won’t cost you anything, and are typically paid a commission by the company they sign you up with.
Increase Your Deductible
You can increase your deductible on your home insurance policy to save money. According to Buy Side, increasing your deductible by $500 can save you as much as 20% on your annual premium.
However, it comes with risks. A higher deductible means you’ll pay more out of pocket if an event occurs.
Adjust Your Coverage
You can adjust your coverage to lower your premium. You can do this by reducing coverage on certain items or removing coverage on something altogether.
Look for Discounts
According to Buy Side, most insurance companies offer discounts, including for seniors, policy renewals, going claim-free for a certain period or bundling your policy with other types of insurance. Companies may also offer discounts for installing security systems, storm windows or fire sprinkler systems.
Consider Home Insurance Costs When House Hunting
Homes in high-risk areas typically have higher premiums. The likelihood of severe weather, crime and other risks varies by geographic location. For example, Policygenius found that homeowners in Florida pay an average of 35% more, while homeowners in Vermont pay just 10% more.
You should also consider home insurance costs when looking at properties, Buy Side added. Certain features could increase the cost of coverage.
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This article originally appeared on GOBankingRates.com: How To Save on Rising Home Insurance Premiums
