Many joys come with being a homeowner, but while shopping for a home insurance policy isn’t necessarily one of them, finding a great discount just might qualify. Fortunately there are several common home insurance discounts available, no matter if you’re a seasoned homeowner or a first timer. An independent insurance agent can help you find the discounts that you best qualify for, but here’s an overview of a few of the most common to get started.
What Kinds of Common Home Insurance Discounts Are Available?
When it comes to home insurance rates and potential discounts, it all comes down to how much of a risk factor can be shaved off of your property in order for the insurance company to cut you some slack on your premium. Insurance companies’ four major concerns for homes are fire damage, water damage, theft, and hail damage. A good rule of thumb to start with is if you’ve taken extra measures to prevent these perils, you’re more than likely eligible for a discount.
Here are a few of the most common home insurance discounts on the market:
- The new home discount: It may come as a surprise that newer homes are actually cheaper to insure because they come without plumbing or wiring issues found in older homes. As a result, if you purchase a brand new home, you’re likely to get a significant discount on your insurance policy.
- The companion policy discount: If you purchase your auto insurance through the same provider as you have your home insurance coverage, you’re likely to receive another significant discount on both of your premiums.
- The burglar alarm discount: Theft is a huge concern for insurance companies. If you install a burglar alarm or any kind of security system on your home, you can greatly reduce your risk of break-ins and theft. As a result, your insurance company will likely reward you with a discount.
- The gated community discount: This one also relates to the risk of theft. Living in a gated community will obviously reduce that risk, and insurance companies observe that. If you’re fortunate enough to live in a more secure community, you’re more than likely also fortunate enough to receive a break on your home insurance premium.
- The fire extinguisher discount: Insurance companies’ number one concern when it comes to homes is fire damage. Any measures you take to reduce your risk of fire damage are likely to also reduce your home insurance premium. This includes purchasing a fire extinguisher.
- The sprinkler discount: Similar to the previous example, only a sprinkler system is a much more effective means of preventing fire damage, and therefore comes with the potential for receiving a much more significant discount.
- The no-loss history discount: Insurance companies have access to your home’s history of insurance claims. If you purchase a home with no claims history, you might just receive a discount on your home insurance premium.
- The hail-resistant roof discount: This one only applies if you live in an area that’s prone to hailstorms. If you’ve upgraded your roof to hail-resistant shingles, your insurance company is likely to reward you with a significant discount.
- The pool discount: This one is very specific. If you live in an area far away from all fire departments and you install a pool in your yard, your insurance company is likely to offer you a discount because the fire company now has a water source to draw from in the event of a fire.
Keep in mind that this is only a list of common home insurance discounts available on the market and is not extensive. These discounts also may not apply to everyone in each situation, and the availability and amount of the discount offered will vary heavily by the insurance company. Your independent insurance agent can provide you with more information.
Do Certain Locations/States Have More Discounts?
While various locations do have different discounts available, it’s not necessarily true that one state has more discounts over another. The discounts offered in one area may be similar to another area or completely different. It all depends on what makes sense for the specific area.
For example, various weather-related home insurance discounts would apply to residents in Minnesota, but not residents in Florida. The terrain and weather conditions are just vastly different between these two locations, so it wouldn’t make sense for all the same discounts to be available or offered.
Crime rates are another factor that influence discounts available in a certain area. In areas at higher risk for crime, adding security features to your home or moving to a gated neighborhood will have a much more significant impact than if you purchase a home in an area that’s already determined to be fairly safe and low on crime. However, purchasing a home in a safer area is likely to help you more with your premium in the first place.
How Much Are These Common Discounts Actually Worth?
It’s hard or even virtually impossible to offer exact dollar amounts for these discounts without knowing which specific insurance company and policy is in question. For starters, not every insurance company offers the exact same discounts, or the exact same discount amounts on their premiums. It’s all highly subjective to your unique situation, but working with an independent insurance agent can seriously increase your chances of finding the best discounts.
That being said, for the more significant discounts such as the new home discount, the companion policy discount, the sprinkler system discount, and the hail-resistant roof discount, you’re likely to see a break of 10% to 15% or possibly even more on your premium. Certain discounts are less significant, such as the gated community discount or burglar alarm discount, and you might only knock 2% to 5% off your premium. Still, every bit helps.
Benefits of an Independent Insurance Agent
Independent insurance agents have access to multiple insurance companies, ultimately finding you the best coverage, accessibility, and competitive pricing while working for you. Find an independent insurance agent in your community here.
TrustedChoice.com Article | Reviewed by Paul Martin
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