What are 11 ways to lower my home insurance costs?

You can lower your home insurance costs by raising your deductible, bundling policies, and improving home security.

💡 11 Ways to Lower Your Home Insurance Costs

• 📊 Raise your deductible: Increase from $500 to $1,000 to save up to 25% on premiums.
• ✅ Bundle your policies: Combine home and auto insurance with the same provider for 5% to 15% savings.
• 📌 Shop around: Compare rates from multiple insurance companies annually.
• 🛡️ Improve home security: Install burglar alarms, smoke detectors, or deadbolts for a 10% to 25% discount.
• 🏠 Fortify against disasters: Add storm shutters or impact-resistant roofing to withstand local weather.
• 📈 Improve your credit score: Maintain good credit, as insurers use history to determine pricing.
• 🗒️ Avoid small claims: Skip filing minor, non-catastrophic claims to keep your claims-free discount.
• 📅 Review coverage yearly: Adjust rebuilding costs to exclude land value and avoid over-insuring.
• ⚠️ Remove high-risk items: Avoid trampolines or dangerous swimming pool setups that drive up liability.
• 🔎 Ask for minor discounts: Inquire about paperless billing, loyalty perks, or pay-in-full rates.
• 🗓️ Update major systems: Replace aging roofs, plumbing, or electrical systems under 30 years old for credits.

You can lower your homeowners insurance by shopping around for new quotes and adjusting your policy details.

Shop and Bundle

• Compare rates: Check prices from multiple companies using a local independent agent to find better deals in your area.
• Bundle policies: Buy your home and auto insurance from the same company to save up to 30%.

Adjust Your Policy

• Raise your deductible: Increasing your deductible from $500 to $1,000 can lower your premium by up to 25%.
• Avoid small claims: Skip filing minor claims that cost close to your deductible amount to prevent rate hikes.
• Check rebuilding costs: Insure your home based on the actual building cost, making sure not to include the value of the land.

Improve Your Home

• Upgrade high-risk areas: Fix an old roof or update old plumbing and electrical systems to remove surcharges.
• Add safety devices: Install smoke detectors, burglar alarms, deadbolts, or smart water leak sensors.
• Maintain credit: Keep a strong credit score, as insurers use it to set premium rates.

The quickest way to get cheaper insurance is to shop around and compare quotes from at least three different companies, as switching providers saves a median of $461 per year.

Adjust Your Policy and Coverage

• Raise your deductible: Increasing your deductible from $200 to $500 or $1,000 can lower your collision and comprehensive costs by 15% to 40%.
• Drop unnecessary coverage: Remove collision and comprehensive coverage on older cars if the annual premium is more than 10% of the car's actual cash value.
• Avoid filing minor claims: Pay out-of-pocket for small, single-car fender benders to keep your driving record clean and prevent rate hikes.

Maximize Discounts

• Bundle your policies: Combine your auto insurance with a homeowners or renters policy for savings up to 30%.
• Opt for digital perks: Sign up for paperless billing and automatic monthly payments to shave a few percentage points off your bill.
• Take a safety course: Complete an approved defensive driving course to earn a recurring 5% to 15% discount.
• Enroll in telematics: Use safe-driving monitoring apps or plug-in devices if you are a low-mileage or cautious driver.

Optimize Timing and Driver Profile

• Shop in advance: Request new quotes 24 to 28 days before your current policy expires; waiting until the last minute can significantly increase your rates.
• Update your mileage: Report lower annual mileage if you drive less than 10,000 miles a year.
• Improve your credit score: Pay down debts and monitor your credit report, as most insurers use credit-based scores to determine pricing.

For more detailed strategies, read the Consumer Reports Guide on Saving on Car Insurance or explore tips directly from Progressive.

Dave Ramsey recommends choosing Replacement Cost Value (RCV) coverage, carrying high deductibles, and setting liability limits of at least $300,000 to $500,000.

Core Coverage Recommendations

• Dwelling Coverage: Get enough to rebuild your home completely using RCV (not Actual Cash Value), aiming for extended or guaranteed replacement cost coverage to handle rising local building costs.
• Personal Property: Choose RCV for belongings so you can buy new items rather than getting paid depreciated garage-sale values.
• Liability: Set personal liability limits between $300,000 and $500,000, and add an umbrella policy if your net worth exceeds $500,000.
• Additional Living Expenses: Include coverage for extra living costs (around 20% to 30% of your dwelling limit) while your home is repaired or rebuilt.
• Exclusions: Purchase separate endorsements or riders for major natural disasters like floods, earthquakes, hurricanes, or sinkholes, as standard policies exclude them.

Policy and Saving Strategies

• Raise Deductibles: Choose a high deductible that fits comfortably inside your fully funded emergency fund to lower your monthly premium.
• Skip Home Warranties: Avoid paying for home warranties; instead, put that money directly into your emergency fund to pay for minor house repairs.
• Bundle Policies: Combine your homeowners insurance with an official Ramsey-approved home and auto bundle or shop through independent brokers like Zander Insurance to compare multiple carrier rates.
• Limit Small Claims: Avoid filing claims for minor repairs, as frequent claims can drive up your insurance rates.

When speaking to your home insurance company or adjuster, avoid guessing, admitting fault, or using speculative language that can reduce or deny your payout.

Phrases and Statements to Avoid

• "I think" or "It might have been": Speculating on how damage occurred introduces doubt. Stick strictly to facts you can prove with evidence.
• Saying "Flood" too soon: Standard policies exclude surface floods. If you are unsure of the water source, use the broader term "water damage" until an expert inspects the property. Never lie, but let professionals determine the exact cause.
• "It's not that bad" or "Minor damage": Downplaying the situation can lead the adjuster to offer a lower settlement than what repairs actually cost.
• "I admit fault" or accepting blame: Never take responsibility for an incident before a full investigation occurs.
• "I don't have records or receipts": Admitting you have no proof of ownership or prior maintenance makes it harder to claim high-value items.

Best Communication Practices

• Stick to observable facts: Describe only what you can clearly see.
• State you are not an expert: Clarify that you require a professional evaluation to assess the total scope of the destruction.
• Keep records: Document all interactions in writing or log the date, time, and name of every representative you speak with.