10 Ways to Lower Your Homeowners Insurance Costs

Homeowners insurance is an essential expense, a critical shield that protects your most valuable asset from financial disaster. But while this coverage is non-negotiable, the price you pay for it isn't set in stone. Many homeowners mistakenly believe their premium is a fixed cost they have little control over, but that couldn't be further from the truth.

Insurance companies use a complex algorithm to determine your rate, weighing dozens of factors to assess the risk of insuring your property. By understanding what these factors are, you can take proactive and strategic steps to present your home as a lower risk, which in turn can lead to significant and lasting savings.

This guide will outline 10 of the most effective and actionable strategies for lowering your homeowners insurance costs, ranging from simple policy adjustments to smart home upgrades.

1. Raise Your Deductible

This is the quickest and most direct way to lower your premium. Your deductible is the amount of money you agree to pay out-of-pocket on a claim before your insurance coverage kicks in. There's an inverse relationship between your deductible and your premium: the higher your deductible, the lower your annual premium. By increasing your deductible from, say, $500 to $1,000, you are taking on a greater share of the initial risk, and the insurance company will reward you with a lower rate. Raising it to $2,500 can save you even more.

Actionable Step: Ask your insurance agent to run the numbers. Find out how much you would save by increasing your deductible to various levels. Choose the highest deductible that you could comfortably pay on a moment's notice without causing financial hardship.

2. Bundle Your Home and Auto Insurance

This is one of the biggest discounts available. Nearly every company that sells both auto and homeowners insurance offers a significant "multi-policy" discount for bundling your policies with them. This discount can often range from 10% to 25% on both premiums, potentially saving you hundreds of dollars a year.

Actionable Step: If your policies are currently with different companies, get a bundled quote from both of them. Then, get quotes from at least two other major insurers to see who can offer the best combined price.

3. Shop Around Periodically

Insurance is a competitive market, and rates change. The company that offered you the best price three years ago may no longer be the most competitive option today. It's a good practice to re-shop your insurance every two to three years, or after a major life event. Don't be afraid to switch carriers if you find a better value elsewhere.

Actionable Step: When your policy comes up for renewal, take an hour to get fresh quotes from a few competitors. Make sure you are comparing "apples-to-apples" coverage with the same limits and deductibles.

4. Improve Your Home Security

A safer home is a less risky home to insure. Insurers offer discounts for features that reduce the risk of theft and fire.

• Smoke Detectors and Fire Alarms: Most homes have them, but make sure they are modern and functioning.
• Deadbolts: A simple but effective theft deterrent.
• Monitored Security System: The biggest discounts in this category often come from having a professionally monitored alarm system that automatically alerts the police or fire department in an emergency.

Actionable Step: Tally up the safety features in your home and make sure your insurer knows about them. If you're considering a security system, ask your agent beforehand what kind of discount you could expect.

5. Upgrade Your Roof

The age and condition of your roof is one of the most critical factors in an insurer's calculation. A new, well-maintained roof is your home's first line of defense against wind and hail. If you live in an area prone to severe weather, investing in impact-resistant roofing materials (often called Class 4 shingles) can earn you a substantial discount.

Actionable Step: If your roof is approaching 15-20 years of age, it may be time to consider a replacement. When you do, talk to your roofer about impact-resistant options and get a quote from your insurer on the potential savings.

6. Fortify Your Home Against Wind

In areas prone to hurricanes or high winds, taking steps to make your home more wind-resistant can lead to significant premium reductions. This can include:

• Installing storm shutters or impact-resistant windows.
• Reinforcing your garage door.
• Using hurricane straps or clips to strengthen the connection between your roof and the walls of your house.

Actionable Step: Contact your insurance agent or a local contractor to discuss a wind mitigation inspection. This assessment will identify areas for improvement and may be required to qualify for wind-related discounts.

7. Improve Your Credit-Based Insurance Score

In most states, insurers use a credit-based insurance score to help predict risk. As we discuss in our article on credit scores, studies have shown a strong correlation between a higher score and a lower likelihood of filing a claim. Improving your general credit health can have a direct, positive impact on your insurance premiums.

Actionable Step: Practice good credit habits: pay all your bills on time, keep your credit card balances low, and regularly check your credit report for errors.

8. Review and Remove Unnecessary Coverage

While you should never skimp on essential coverage like dwelling and liability, you may have optional coverages you no longer need. For example, if you bought a special rider to cover expensive jewelry that you have since sold, make sure to remove it from your policy.

Actionable Step: Conduct an annual review of your policy with your agent. Discuss each line of coverage and confirm it's still relevant to your current situation.

9. Maintain a Good Claims History

A homeowner with a long history of not filing claims is seen as a lower risk. While you should never hesitate to file a claim for a major, catastrophic loss, think twice before filing a claim for minor damage that is close to your deductible amount. A history of small, frequent claims can lead to a premium increase or even non-renewal of your policy.

Actionable Step: Use your insurance for its intended purpose: to protect against major financial losses, not for small maintenance issues.

10. Ask About Other Discounts

Insurers offer a wide variety of smaller, less-known discounts that can add up. It never hurts to ask. These can include discounts for:

• Being a non-smoker.
• Being retired.
• Having a newer home.
• Living in a gated community.
• Loyalty (being with the same company for many years).

Actionable Step: Get on the phone with your agent and ask them to perform a full discount review. Simply say, "I want to make sure I'm receiving every single discount I'm eligible for."

Conclusion

Your homeowners insurance premium is a dynamic cost, not a fixed one. By taking an active role in managing your home's risk profile—through smart maintenance, strategic upgrades, and savvy policy management—you can take control of your insurance costs. These proactive steps will not only make your home a safer place to live but will also ensure you are getting the best possible price for the essential protection your policy provides.