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Top Tips for Finding Affordable Home Insurance

Finding the best deal, whether you’re buying a new car or renewing your home insurance doesn’t happen of its own accord, but luckily for you, there is a vast insurance market eagerly seeking your custom which gives you the advantage.

To help you find affordable home insurance which effectively safeguards your property against theft or damage this helpful guide outlines some of the top tips sure to get you an amazing deal.

home insurance
home insurance

Shop Around

When your home insurance expiry date is looming over you, it can be easy just to stick with the same old insurance company – after all, at least you know what you’re getting, right? Wrong. The policy you took out last year will probably have changed; therefore even if you are keen to stick with the same insurance company, it’s important that you read over the new policy they have offered you.

However, the top tip for getting affordable home insurance is to do your research and generally shop around. The benefits of this are that you will get an understanding of the typical price you will be expected to pay and gives you a starting point from which to start haggling.

Shopping around has never been easier, especially with comparison sites which effectively do all the hard work for you – so, what are you waiting for?

Ask for a Special Deal

Once you have looked at the market and compared prices, it’s worth calling your existing insurance provider to ask for a loyalty deal. They will be keen to keep you as a customer, and if you have the details of the offer you have seen, they will most likely match it.

If not, they do not deserve your custom and in today’s society, there is no room for loyalty if the company in question has not done anything to promote it.

If you’re a first home buyer looking for home insurance, it can be easy to feel overwhelmed by the sheer number of insurance providers and their different insurance policies but don’t worry, you can still get a good deal. All you need to do is research the various deals available and ask whether you can get a better deal – if you don’t ask you won’t get.

High Security = Lower Insurance

A home with an alarm will generally have lower insurance because the risk of a break-in and damage is reduced as a result of the heightened security measures in place. Therefore, if you are thinking of securing your home, make sure that when you do, you tell your insurance provider because you may see a decrease in the monthly amount you have to pay.

Saving on insurance is an important part of being financially responsible. Owning a home is a major task that requires careful attention to detail. The costs of home insurance vary by large margins if you are not careful with your finances.

Buy Plans From the Same Insurance Provider

Many companies have plans for home, car and business insurance. You can save a high percentage by bundling several plans from one company. Receive peace of mind knowing that your policies are available in one place.

However, make sure that you are actually getting good policies instead of just worrying about getting bundled discounts. Doing your homework on each of your policies can really pay off in the long run.

2.    Keep the Deductible High

Before any insurance claim can be made, you have to pay the deductible. The higher that amount is, the less you spend on the premiums. The average deductible is around $500-$1,000. In most cases, if you increase the deductible amount to save on your monthly premium.

Having more money to manage your other expenses can be a great relief for families in a bind. Remember to consider the separate deductibles that you may have to pay separate disasters like fire or flood damage.

3.    Use Technology to Keep Control of Finances

With new innovative tools to manage your finance, you can make paying bills a breeze and even get amazing ideas for keeping your insurance-related finances in check. Make one-time payments to your insurance company that help you retain good, low rates.

Never get confused about money again when you use home finances software, HomeZada is a product that allows your finances to stay organized at all times. Never miss another payment when the time of the month comes around that you need to pay your bills.

4.    Increase the Safety of Your House

At first, this option does not seem beneficial because you have to remodel the house, which is expensive and time-consuming. However, the benefits include increasing your home security and receiving a discount from your insurer. Insurance companies like responsible customers who work to stay safe.

They reward you for making your house more resistant against floods, theft and other disasters. Also, you can reduce the premiums that are likely to cause financial problems. In the end, your house is safer and you create a better relationship with the insurance company.

Home insurance is affordable for all people, including the ones who have on-and-off financial difficulties. There are many tips that will help you receive better rates on insurance. One tip is to organize your finances with budgeting software.

Another tip is to consider remodeling your home if you want to receive major discounts from the insurer. Take control of your finances by investing in a few, basic home insurance tips.

While these are only a few of the tips available to get your insurance at an affordable price, they are among the best, however the best advice you can receive on lowering your insurance is to haggle, barter and ask for deals left right and center – you’ll be amazed at how much your insurance provider is able to knock off their original offer.

Common Mistakes When Purchasing Home Insurance

Many homeowners have peace knowing that their home is protected by insurance, but this may be a false sense of security. As a matter of fact, there are a few common mistakes that many homeowners make when purchasing insurance that can lead to significant financial loss. These seemingly minor errors can easily turn into a massive nightmare in the event that something did occur.

Insufficient Amounts of Insurance

There is a difference in the market value of the home and the costs to rebuild. In order to save money, the consumer may be inclined to insure the home for the market value. This is a huge mistake. Rather, the homeowner should purchase enough insurance to cover replacing or rebuilding.

Also, it is important to carefully read all the policy documents. Insufficient insurance can also result when the insurance only pays out a flat rate, rather than the actual cost of replacement. The homeowner should know what he is purchasing and ensure that the policy does not offer a flat rate.

Misunderstanding Coverage

It is not at all uncommon for the consumer to purchase homeowners insurance and only find out at a later date, it does not cover what he thought it did. There are several things that homeowners insurance may not cover. For example, if the home is damaged due to a flood, homeowners insurance does not cover this. Loss of personal property due to covered events are typically not covered either. The homeowner should know what the policy will and will not cover, purchasing additional insurance if necessary.

Failure to Shop Around

The homeowner may bundle all insurance policies in order to obtain discounts or just go with a local insurer because they are local. This is a big mistake that can cost the consumer their hard earned money. Looking at the testimonials of their clients is also a good idea. Failure to shop around can lead to lesser coverage at higher rates, as can choosing a policy based solely on an attractive premium. Therefore, the consumer should look around and not only compare rate quotes but the type and amount of coverage.

Getting the Most Out of the Policy

Failing to shop around, not purchasing enough insurance and misunderstanding the coverage offered are three of the biggest mistakes made by the homeowner. These things alone can wreak havoc on consumer finances if the unthinkable should occur.

Avoiding these common pitfalls is not difficult. Taking the time to understand how homeowners insurance works and looking at the various options available can save time, money and hassle.

When To Adjust Your Home Insurance

Along with automobile and life insurance, home insurance is one of the most familiar kinds of insurance available to consumers. The average Joe might think that, because of this prevalence, people would have a solid understanding of when to reassess and change their home insurance policies, but unfortunately, this is often not the case.

Many individuals dramatically overpay on their premiums or experience significant losses as the result of not adjusting their coverage.

You move, or you sell or buy a new home

At the most basic level, home insurance reflects the value of the property at which you are living, along with the belongings you keep in that property. When you move to a new location, sell a home or buy another one, that value almost always changes, often very significantly.

Insurance companies usually are specific about the address involved in the coverage, as well, so even if by chance the amount of coverage you need remains the same, you still need to update the policy to reflect that the location involved is different.

You gain or lose belongings

Many individuals forget to adjust their home insurance when they sell or give away assets covered under their policies, such as heirlooms. Similarly, they don’t always reevaluate their coverage when they acquire more items of value, such as a newer TV or upgraded furniture.

And don’t make the mistake of thinking that lower-priced purchases won’t affect your need for adjustment—smaller buys can add up to a big total and put you out a pretty penny if you need to replace them all at once.

Your home or belongings have depreciated or appreciated in value

Very generally, homes gain value when they are enhanced, such as happens with renovation or remodeling. Additionally, land tends to appreciate over time, simply because it is in limited supply.

Conversely, houses that are simply maintained depreciate in value, because their designs can go out of style, and because the amount of money necessary to keep them in order usually goes up as the structure gets older.

Land values can go down, as well, depending on environmental or community changes. If your neighborhood has shifted significantly, or if you’ve made adjustments to the property, it’s time to call your insurance provider.

With the exceptions of antiques and collector items, most belongings people have gone down in value because of wear and tear. In particular, technology-based merchandise depreciates extremely quickly, because new models constantly are flooding the market.

It’s necessary to look at the big picture, here, though—people tend to acquire more belongings over time, so even when items are depreciating, coverage needs can stay the same or even go up.

Need To Fine Tune Occasionally

Home insurance is not a static thing when used properly. It needs occasional fine-tuning in order to reflect your circumstances accurately. Although you probably don’t need to be getting on the phone with your insurance company every week, it’s a good idea to see where you’re sitting once or twice a year.

A great time to think about adjustment is when you do your annual taxes. This is a period when most people are thinking about their income, expenditures, losses, and gains, and odds are, you’ll be digging around in your financial and property records to complete and file your tax return, anyway.

The Top 10 Myths About Home Insurance

There are a number of myths regarding insurance and home insurance is no exception. If you want to get realistic coverage for your home, you need to be aware of the myths and misconceptions related to home insurance. In this post, I will discuss the top 10 myths associated with home insurance.

A home should be is insured for the purchase cost

One of the most common myths about home insurance is that it should be insured based on the purchased cost. In reality, the insurance should be done based on the replacement cost and not the purchase cost. The replacement cost depends on a number of factors like a neighborhood of the home the view from the home.

Water damage (Flood damage) is included in the home insurance

Most people think that all types of water damages are covered in home insurance. But in reality, flood damage is not included in the insurance coverage. The water damage only includes accidental damage due to water. This includes sudden bursting of water pipes in your home resulting in property damage. If you live in an area that is regularly affected by the flood, you should take extra flood insurance for your home.

Maintenance is included in Home insurance

Some of the home owners think that maintenance costs are also included in home insurance but it is not true. In reality, home insurance only covers cases like theft and fire accidents.

Damages due to all the natural disasters are concerned

Again, a common misconception about home insurance is that it covers the damages due to every natural disaster. In reality, most of the insurance policies do not cover floods or earthquakes. You need to read the whole policy in detail to find out these minute details. In case, you want to cover all the natural disasters, you can take extra policy.

All the items in home are insured

Though the insurance companies claim complete insurance for all the items or personal property, there is a limit for valuable items like jewelry.

The expenses for home accidents is also covered

The home expense for the injuries is meant only for the guests. It is not meant for the home owner or his family members.

The premium increase with a claim

Some people think that the premium for the insurance increases whenever a claim is filed. This is not completely true. The premium is raised only when multiple claims are filled in a short period of time.

You should take low coverage for a low premium

Some of the home owners believe that the only way to get a low premium for the insurance is to opt for low coverage. This is actually a myth and you should take proper coverage to reduce the risks associated with potential damages.

You need to buy insurance if you own home

Though it is always advised to buy home insurance, it is not compulsory and is thus at the will of home owner.

Home insurance also covers mold

The final myth about home insurance is that it also covers mold. In general, any defect caused due to your negligence is not covered.

Home Insurance For Buildings

Home buildings insurance covers any damage caused to your home by a number of events. These include amongst others fire, lightning, explosion, earthquake, riot, malicious damage, storm and flood, water damage from burst pipes or tanks, the escape of oil, impact by vehicles, aircraft, falling trees and branches, aerials, subsidence, landslip, and theft.

Additional cover generally includes the cost of alternative accommodation should your home become uninhabitable; liability insurance; underground services; baths, showers, and WCs; and glass in windows and doors.

Generally the cost of emergency repairs is covered; for instance, the cost of providing a temporary cover to your house should the roof be damaged in a storm; some insurance companies operate 24/7 emergency helplines.

Many policies have specific exclusions too, so when taking out buildings insurance it is important to pay attention to the small print. Most policies exclude damage due to war, damage to fences, frost damage, and radioactive contamination.

Nearly all buildings insurance policies have an excess. This is the amount that the claimant needs to contribute to the cost of repair or replacement. Sometimes there is an overall excess, and sometimes different items have different excesses, for instance, subsidence claims generally have a very large excess.

Buildings insurance policies include a sum insured clause. This is the maximum amount that may be claimed. It is important not to undervalue your sum insured, but it is also important not to over-value it too as that would waste money.

It should cover the cost of rebuilding your home rather than its market value. You can discover this by having a surveyor by providing the full details of your home to your insurer, however, the sum is your responsibility not that of your insurer.

Also rebuilding costs are subject to inflation, so they need revising regularly, preferably every time you renew your policy.

Warren Paine

Warren is the senior mortgage loan officer who has worked in mortgages and loan industry since 1995. He study in Harvard and major in Finance with a Bsc. Honor Degree. He possesses a Paralegal Certificate as well.

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