While homeowners insurance premiums are on the rise, these effective strategies can potentially reduce your costs.

1. Bundle your policies

Bundling homeowners, auto insurance and any other policies under the same insurer can save you money.

The amount of money you can save will vary depending on the state in which you live, the type and amount of coverage you have and the insurer.

2. Ask about discounts

These are common types of discounts offered by insurers on homeowners policies.

• New roof discount

• Home security discounts

• Disaster resistance discounts

• Long-term customer or loyalty discounts

• Military discount

• E-billing discount

• Discount for premium payment in advance

• Claim-free discount

• Fire safety discount

• Green home discount

• Retiree discount

Installing a centrally monitored security system, like ADT and SimpliSafe, and installing devices such as smokedetectors, fire alarms, and sprinkler systems, may all qualify for discounts.

Ask about savings through affiliations with various organizations. Many insurance companies provide group discounts to members of professional associations or alumni groups.

3. Raise your deductible

Increasing your deductible from $500 to $1,000 could generate savings on your annual home insurance premium by as much as 25%. However, the higher your deductible, the more you will pay out of pocket to cover home repairs.

For example, increasing your deductible from $500 to $2,500 might save you $500 annually, but you'll pay the first $2,500 of any claim.

4. Improve your credit score and maintain a high credit rating

Insurers often use credit-based scores to assess risk, and a higher credit score can lead to more favorable rates.

To improve your credit score:

• Pay all bills on time

• Keep your credit utilization ratio low by using no more than 30% of your available credit

• Regularly monitor your credit report to correct any errors

• Avoid opening multiple new credit accounts in a short period of time

Credit monitoring services like myFICO provide access to your FICO® credit scores

and three-bureau credit monitoring, and offer insights into your financial health.

The bottom line

Insurance premiums vary widely among providers, and by comparing quotes, you may find a policy that offers the same or better coverage at a lower cost.

Source: https://www.kiplinger.com