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Stop Wasting Money On Excess Homeowner's Insurance

Home insurance may seem like a necessary evil, but not only does it protect homeowners from suffering major losses, it also costs much less than people think. The truth is that many people are overpaying for their home insurance. Sometimes people over-insure or fail to update their policy when situations change. A thorough review of insurance policies along with employing a few money-saving tactics can save hundreds of dollars per year.

How to Save Money By Raising Deductibles

Increasing deductibles is a guaranteed way to reduce monthly payments, explains a Money Talks News post published on Policy holders can save upwards of 10 to 30 percent by raising their deductible from $250 to $1,000. Money saved can then be put into an emergency fund to cover the deductible in the event something happens to the home or be used for other emergencies.

It is also a good idea to review any policy extras as they may no longer be needed. The value of items in the home may also change. There is no point paying extra to insure things like jewelry that are no longer on the property.

Why People Do Not Need to Insure Their Lots

Many people insure their homes for the price they paid for the property. This is often unnecessary. If someone pays $500,000 for their house they do not need a policy to cover $500,000. Part of that money went to pay for the land. The actual value of the house is going to be less than the purchase price and the lot itself is not going to be stolen, robbed or burned up in a fire.

See Also: Protecting home value against housing busts

Why It Pays to Shop Around

People can obtain direct insurance quotes quickly and from multiple companies online. Policy prices do vary and shopping around for the best price can save a bundle in the long run.

Also, shopping around may uncover discounts that a person's direct insurance company is not offering. Many insurance companies offer discounts to people who have multiple policies or who qualify for discounts based on factors such as age or martial status.

How Safety Features Can Save Money

Some insurance companies give discounts to homeowners who install safety features or disaster proofing. Generally, homeowners can save a minimum of 5 percent simply by putting in a security alarm, fire extinguisher or dead bolt locks. More advanced security systems better protect homes and may save owners up to 20 percent off their premiums.

Other potential money savers include storm shutters, stronger roofs and other weather-resistant features.

Things to Remember When Dealing With Tenants

Tenants sometimes mistakenly assume that they are covered by their landlord's insurance. This misconception can put landlords at risk. If a tenant does not get their own insurance and then causes damages that affect nearby properties their landlord could be on the hook to pay for major repairs out of pocket.

What to Consider About Home Insurance and Business

According to, home insurance usually covers only $2,500 for business-related property. Policies typically exclude business activities and something as common as children holding a car wash or setting up a lemonade stand can get parents in trouble if the kids business activities cause damage.

Companies have different rules for household members and minors engaged in business activities on the property. Switching to a company that covers these activities may save money in the future.

Although no one can avoid home insurance altogether, everyone can save money by insuring only what they need. Changing policies as life situations change also ensures that people never overpay.

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