Having the right homeowners insurance helps protect your home against covered perils. You can file claims with your insurance provider if your home or its belongings get destroyed or vandalized in situations listed under your policy agreement. This policy kicks in if you lose your belongings in a fire, theft, burglary, and damaging weather conditions. Your home contains some of your most precious belongings, so you want to make sure that it is well protected.
Factors That Affect Your Home Insurance Premiums
The following are some factors that might affect your home insurance premiums.
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Credit Score
It is understood that insurance providers tend to favor clients with high credit scores because it gives them a sense of confidence that the latter will not default in paying their dues. Most insurance companies request credit scores from the homeowners before determining their premium rates. This is one of the numerous advantages of maintaining a good credit score.
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Insurance Claims History
If you have a habit of making claims each time there’s an incident, your provider is more likely to charge you a higher premium than others for coverage. It is best to only make claims when significant losses you can’t afford to bear on your own.
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Type of Pets
Ask your provider if your home insurance covers your pet. Many providers do not include coverage for specific breeds of animals, especially aggressive ones that are likely to attack visitors. Homeowners with pets will likely pay more premiums than others.
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Age of Your Home
If you live in an old building, you will have to pay higher premiums due to the increased risks of wear and tear. Newer houses will not require frequent repairs, so they tend to cost less.
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Cost of Rebuilding
The entire cost of rebuilding your home will influence your premium rate; hence, living in expensive homes in affluent locations will attract higher premiums.
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Other Structures
High-risk fixtures and installations like swimming pools, Jacuzzis, and trampolines will significantly increase your rate. This is because the existence of such structures on your property exposes you as well as your visitors to greater risks of accidents, such as slips and falls.
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Risk of Natural Disasters
People living in high-risk zones such as areas prone to flooding or earthquakes will have to pay much higher premiums than those living outside those areas.
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Frequency of Crime
Living in an area that is known for frequent break-ins and other property crimes will also increase your home insurance premiums.
Tips to Lower Your Monthly Home Insurance Payments
Raise Your Deductibles
One of the most effective ways to reduce your periodic payments is to raise your deductible. This is the quickest and most inexpensive option to reduce your premiums.
Implement Safety Measures
Installing safety equipment like a fire alarm, fire extinguisher, or an at-home security system can reduce your premiums. Insurance providers tend to reduce the premium rates or offer discounts to clients who follow safety measures as they present a low likelihood of making frequent claims.
To sum up, your home insurance premium rate is influenced by your coverage limit; the higher your limit, the higher your premium, and vice versa.
If you have more questions about homeowner insurance, the Schwab Agency professionals are the right experts for you. Contact us to get started today!