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With the average annual premium for homeowner's insurance at $808, there are plenty of reasons to look for discounts, especially for homeowners in such hurricane-prone states as Louisiana ($1,586 average premium) and Florida ($1,101).
Raising the deductible and staying with the same insurer are common ways to lower insurance expenses, but there are others that most people don't know about — or don't learn about until after a disaster hits their home.
Like bargaining with an auto dealer or going to a furniture store and trying to haggle for a lower price, you often won't get home insurance discounts unless you ask for them. That's why it pays to shop around, especially with a list of questions on the type of discounts insurers offer.
Not all home insurance companies offer the same discounts, so it's worth it to shop around. If getting a discount requires fixing your home — such as getting a new roof — you may not get it until the work is completed.
Discounts can range from as little as 2% or so up to 20% or more. If you're going to stay in your home for years to come, paying for some home improvements now may be worth it in the long run for an insurance discount.
Here are some home insurance discounts worth asking about:
Security. From installing adequate locks to hiring a team to install alarms throughout your house, preventing home break-ins can lead to a savings of 2% to 5%, said Bill McGarry, a property manager for private homes in Palm Beach County in Florida. McGarry recommends using locks made by a brand name, such as Schlage, and having three locks per door.
Home safety. Keeping your home secure is one thing, but keeping it safe from accidents is another. Carbon monoxide and smoke detectors can be installed rather inexpensively to help prevent accidents that could damage the home and require an insurance claim.
Other safety repairs that could lead to a discount include sprinkler systems, fire extinguishers, handrails alongside stairs, updated wiring systems for multiple appliances, well-grounded outside antenna, a fence with a locked gate around a backyard pool and maintained sidewalks outside that are free of large cracks or holes that someone can trip on.
If your home is near a fire station or you have a hydrant nearby, ask for a discount.
Repairs. A new roof, hurricane shutters and new washing machine hoses are among the fixes that can be done to homes to make them less likely to be damaged. While a new roof is expensive, others can be done inexpensively.
"They sound small, but if you add all of them up, it becomes a dramatic drop in your insurance costs," said McGarry, who works with a real estate company on home repairs and previously worked as a home inspector for 20 years.
Not having hurricane shutters and impact windows in hurricane-prone South Florida can result in higher insurance premiums, so getting them is worth the cost, McGarry said. The shutters are the best protection. They start at about $1,500 for a house and cost about $3,500 for a 2,000-square-foot house, depending on the number of openings. The potential savings can be 8% to 10% on an insurance policy discount.
For about $20, a no-burst washing machine hose can replace the regular hose that comes with a washing machine, eliminating the worry about flooding if a hose breaks, said Elisa Bernick, associate editor at The Family Handyman. No-burst hoses can also be used for toilets and faucets.
"Burst washing machine hoses are at the top of the list for causing major home damage," Bernick said.
New construction. If your home was built within the past decade, some insurers will give a discount because everything should be new and in good enough shape to prevent an accident. You may also get a discount if the home was recently renovated.
Insured to value. Insuring up to 100% of the cost to replace your home — which is usually different than the market value or selling price — can result in a discount.
No losses. If you're a new customer with a loss-free record for three years, you may get a discount. Sometimes called the "Claims Free Discount," it sometimes first requires five years of no losses after buying a new policy.
Inflation protection. If you adjust the amount of insurance to keep up with inflation, you may get a discount.
The Investing Answer: Shop around and ask questions. Sometimes you have to be a pest and ask your insurance agent questions. Unless you have to file a claim, you probably only talk to your agent once a year, so you might as well make it a worthwhile discussion and get help figuring out which discounts your home qualifies for.
And if none of your ideas are ringing any bells, ask the agent for suggestions on what you can do to qualify for discounts they offer.
If they don't have enough discounts or you're paying too high of a premium for what the average price is in your state, shop elsewhere. An hour or less of research could pay off.
Aaron Crowe is a freelance journalist in the San Francisco Bay Area who specializes in personal finance.
