What are some strategies to lower my Homeowner’s rates?

We occasionally get calls from people concerned about their homeowner’s rates. Fortunately, we can make minor changes to your account that might positively affect your rate. Here are several examples of methods that we can use to possibly lower your  homeowner’s insurance rate:

1. Verify if your Coverage A limit is correct. Coverage A refers to the amount of insurance on your dwelling. For many years Coverage A costs have increased due to a commonly added endorsement known as “inflation guard.”

  • Inflation guard automatically increased the amount of dwelling coverage in order to account for inflation.
    • This used to be an extremely valuable endorsement that has recently become obsolete.
  • Ask your agent to rework your Estimated Cost of Replacement Computation to determine if your Coverage A is too high.
  • Be careful adjusting your Coverage A limit, however, and avoid doing so without speaking directly to your agent.

2. Consider raising your Homeowner deductible. There is an easy way to see if this is worth your trouble. For example, let’s say you have a $1,000 deductible. Ask your agent how much your premium would reduce if you raised the deductible to $1,500 or $2,000. If you can save enough money to recoup the amount you have additionally put at risk, it may be worth it to raise the deductible. The savings should be multiplied over a two-three year period.

3. Adjust your Coverage B amount. Coverage B covers the appurtenant structures on your property. Examples of these include: detached garages, carports, storage sheds or any other structures that are clearly separated from the dwelling. Bear in mind, we only have one company that will allow us to adjust Coverage B, but this might also be worth your while.

4. Adjust your Coverage C amount. Coverage C applies to personal property (clothes, linens, furniture, electronics, etc.). Anything located within the house, but not permanently attached to the dwelling applies to Coverage C. Be advised that this does not include carpeting, cabinets, plumbing fixtures or anything else “built-in” as these fall under Coverage A.

A final note on Coverage C – even removing the factor of saving money on homeowner coverage, it’s best to adjust coverage to accurately resemble the realities of your household. Years ago Coverage C was determined as a percentage of the dwelling under Coverage A. At first it was 50%, then it was raised to 70% and it eventually topped out at 80%. This may be more coverage than you need. Talk to your agent about establishing the proper amount for your household.

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