there is little you can do to change your home's location or basic
construction (the main factors that determine your insurance rates),
you can shave hundreds of dollars off your annual premium by taking
advantage of the many discounts that nearly every insurer offers.
are 10 typical ways to get a break.
The "In" Crowd
almost any market, one company wants your business more than
its rivals do. For example, you're highly desirable to some
companies if you own a home in New York, Minnesota, Arizona,
Illinois and Connecticut, where historical loss rates are low.
Other insurers go after groups of customers they judge to be
affluent and responsible, such as university alumni or membership
organizations. The Hartford, for instance, has an arrangement
to provide "lifetime continuation" coverage to members
of the American Association of Retired Persons.
Property Casualty has affinity programs with several chapters
of the American Automobile Association which earn members up
to a 5% credit. How do you find these deals? Call your alumni
association or any clubs you belong to to see if it has a deal
with an insurance company. If all else fails, check with a local
you installed that burglar alarm and those deadbolt locks, did
you inform your insurance company? You should: Such home-security
measures can earn you discounts ranging from 5% to 20%. Do you
have a live-in housekeeper? In many states, Chubb will give
you a 2% credit, since the presence of that live-in employee
can reduce the chance of break-ins.
central alarm system could save you hundreds on your annual
premiums. Insurers will routinely give you 15% to 20% off for
a fire and burglar alarm system hooked up to a third-party monitoring
company. At The Hartford, you can get a 2% discount for deadbolt
locks and a 2% discount for smoke alarms. USAA gives 8% off
for having a sprinkler system. Chubb and other companies give
5% discounts on homes equipped with closed-circuit TV cameras
or outside motion detectors.
The Car Connection
companies give discounts of 5% to 15% off your homeowners policy
if you combine it with your auto policy. The only time it may
be cheaper to keep them separate is if your driving record has
a recent blemish on it. You also may be able to get a discount
if you have a policy for your boat, a package of riders, or
an umbrella policy (which ups your liability coverage to $1
million) with the same carrier.
you already have homeowners insurance, you probably have the
standard deductible of $250, though some deductibles go as low
as $100. But if you're willing to take a higher deductible,
the savings can be substantial. With Safeco, by raising the
deductible to $1,000, you can save 23% off your base premium.
But you don't have to raise your deductible that high to realize
significant savings. At Travelers, raising your deductible from
$250 to $500 brings your annual premium down 10%. If you're
willing to go from $500 to $1,000, you can save another 10%.
Out in the Country
you live out in the boonies, be prepared to pay higher rates
than folks who live in town. That's because it's harder for
the local fire brigade to reach your home in an emergency. In
most cases, you'll be bumped to a higher rate class if you live
more than five miles from the nearest firehouse or more than
1,000 feet from the nearest fire hydrant. But rural-insurance
specialist Old Guard Mutual of Lancaster, Pa., will give you
the preferred rate even if you live miles from the nearest hydrant
-- that is, as long as your home is within five miles of the
local fire department and it has a tanker that can carry water
to the fire scene. If you're determined to live in the country,
don't count on finding a policy with a direct writer. Instead,
work with a local insurance agent to price-shop among small
mutual insurers that specialize in insuring dairy farms and
The Slow Burn
your house is constructed of fire-resistant materials such as
brick or concrete, you've got money in your walls. You can earn
a 15% credit with USAA and Nationwide if your home is "fire
resistive" -- meaning the walls, floors, roof and ceilings
of your home are constructed out of incombustible materials.
Most companies give only a 5% discount if you have a smoke alarm,
fire extinguisher and deadbolt.
New or Newish
about every insurer gives a discount for new homes. But only
a few give discounts for homes that are merely newish. USAA
offers up to 20% off on homes that are less than 10 years old.
Have you upgraded electrical, heating and plumbing systems in
that old house of yours? You're in luck: As far as Travelers
is concerned, those renovations magically turn your old house
into a new one and qualify you for a 15% discount.
8. Thank You for Not Smoking
few insurers offer discounts to nonsmokers. Farmers, for one,
gives a 4% discount as long as no one in the home smokes.
an incentive to stick with one carrier, some insurers offer
discounts to customers who stay with the company for several
years. State Farm offers 5% off if you stay with the company
three to five years and 10% off if you stick around more than
six years. You can earn a 5% discount if you have been with
The Hartford for four or more years.
that senior citizens are home more often and are better able
to protect their homes against fire and burglary, some companies
give substantial discounts to retirees. Travelers, for example,
will give homeowners 50 and over up to 20% off in some markets.