As long as you have a mortgage, you will have homeowner's insurance. Even if you own your home outright, you will probably continue to have homeowner's insurance, as your home is likely the biggest financial investment you will ever make. In the meantime, you may be wondering how to make this type of insurance more affordable, and/or how to reduce your monthly, quarterly, or annual insurance payments.
Do Not Make Unnecessary Claims
This is the biggest mistake homeowners make. They fail to understand that homeowner's insurance does not exist to fix everything that goes wrong with the house, and subsequently use it to fix anything in excess of their deductible. That becomes a problem, because once the claim is processed, it reflects on the insurance record. Then the insurance company can raise your rates to recover their losses. Even though the amount may only appear to be ten or twenty dollars a month, if you file a claim every year or every other year, your insurance rates and premiums will rise. Keep them low by only using your insurance for what it was intended to be used for—disastrous damage to your home.
Consider Paying Quarterly or Annually
Some insurance companies offer big discounts to homeowners who are willing to make quarterly or annual premium payments. So, instead of the monthly payment you are used to making, you make a payment every three months. An annual payment not only pays for the entire year, but typically automatically renews your policy with the insurance company. Both homeowners and insurance companies like the annual option because it means renewed business for the insurance company and easier budgeting for the homeowners who can stash a little cash every month for the next year to pay the next year's insurance or who can use part of their tax refund to pay the insurance.
Check Your Credit Scores
Most insurance companies now rely on credit scores to calculate your rates. If you check your credit scores annually and work to improve them, you can request that the insurance company recalculate its rates on your policy. This, in turn, helps reduce your payments. As your credit continues to improve, you can either revisit this every year, or wait until your credit scores go over 800, which is nearly perfect credit. Insurance companies as well as mortgage lenders love to see these credit scores and are happy to reward homeowners with discounted rates on their mortgages and insurance policies.
Contact an insurance agency like Family Insurance Centers for more information.