Get The Most Value Out Of Your Homeowner's Insurance With These 3 Tips

27 April 2016 by Elijah Steward

Very few people enjoy paying for any type of insurance policy. In the best case scenario, you pay your premiums for years for something that you never use, which can feel a lot like throwing money away. However, when and if the day comes that you do have to use your homeowner's insurance, you'll find out for certain just how much value the policy that you've been paying for actually has. Unfortunately, it's not uncommon to discover at that crucial moment that your insurance isn't worth the amount of money that you've put into it. Take a look at some tips that will help you make sure that when you need it most, you'll get the value you need out of your homeowner's insurance.

Know Your Home's Value

The first rule is to make sure that you have enough insurance to repair or replace your home if the need arises. An insurance policy that only goes part of the way isn't likely to be helpful to you in the aftermath of a destructive event. You want to make sure you're fully covered, and the only way to do that is to be sure of what you're covering.

Don't guess, and don't just settle for your insurance company's valuation of your home. Use a home builder or an assessment service to get an accurate estimate of your home's value by someone who is in the business and knows exactly what to look for. Don't forget that your insurance policy also covers the items inside the house, so determine their value as well, and keep an inventory list in a safe place so that you have it when you need it.

Know Your Risk Factors

Your insurance company bases your insurance rates on risk factors, so you should know them too. Knowing what your risk factors are is not just important for getting a lower rate – it can also help you head off some of those risks ahead of time.

One important tool for the insurance company is your CLUE report. This is something like a credit report but for insurance claims. It keeps track of your claims history for seven years, and it also keeps track of the claims history at your address. Before you buy a new home, you should ask the homeowner to pull a copy of their CLUE report for you to look at – this can let you know if break-ins are common in the neighborhood or if the home has foundation problems. If you already own the home, you can pull your own CLUE report (aside from insurance agencies, only the owner can request a CLUE report.) Like a credit report, you get one free each year. If there are a large number of claims for the address, you may want to pass on it, or at least resign yourself to higher insurance rates.

Bring Your Premiums Down

Once you know what your risk factors are, you can work on mitigating them. Mitigating your risk factors can bring your insurance rates down, allowing you to get the more value for less money. If your home is located in an area that's known for robberies, installing an alarm system or even upgrading your locks can knock some money off the price. If you live in a hurricane-prone area, installing storm window can help.

In many situations, paying the money for repairs and upgrades will be less expensive in the long run than paying overly high premiums for years on end.

Paying for home insurance is unavoidable, but you don't have to pay more or receive less for your money. Making sure that your policy includes the correct values for your home and property, knowing what will drive your premiums up and make claims more likely, and knowing how to mitigate your risks are the best ways to ensure that you're getting the most out of those monthly premiums. 

Contact a company like Sunset Insurance Agency for more information on lowering your insurance rates.

Share

Search