3 Easy Tips to Lower Your Homeowners Insurance Premiums

Homeowners insurance is a vital coverage option if you have a property you'd like to protect. Besides offering protection against vandalism and damage, homeowners insurance also provides liability coverage, which can cover any legal fees from potential lawsuits for cases described under your policy.

However, the amount you pay as a premium will vary depending on factors such as:

• Your location
• Your choice of coverage
• Your home's value

Depending on the type of policy you choose, there are a few ways to reduce insurance costs in Chicago, IL. Learn more about how to save money on your next home insurance policy below.

1. Avoid Over-Insurance 

Over insurance often occurs when you insure your home based on the market value instead of the actual replacement cost. For instance, a standard value assessment could be higher since the valuation could also include the cost of land.

But for an insurance settlement, the reconstruction cost of the same house may be lower than the market value. Added costs such as architect and construction waste removal fees are likely to raise the costs but not more than the market value.

If you insure your home based on the market value, you may end up paying more in premiums. An accurate valuation can help you choose the right coverage for you. Covering a loss is less likely to include the cost of land, so ensure your policy includes only the replacement cost.

2. Install Safety and Security Mechanisms 

Your insurance provider may consider you a low-risk client if you have reliable safety and security measures in your home. Generally, a lower risk may translate to lower premiums. Even simple fire emergency mechanisms such as a fire extinguisher or a smoke detector could help save a few dollars.

Similarly, burglar alarms, security cameras, and intelligent lighting could potentially discourage burglars from entering your home and making off with your valuables. Moreover, adding an extra layer of security, such as bolt locks on your windows, could have you paying less for insurance.

Additionally, damage protection mechanisms could potentially save you a few dollars in insurance premiums. For instance, installing a one-way plumbing valve may reduce the chances of water damage in your home. In the same fashion, a roof reinforcement may help protect your home against wind and storm damage.

Your insurance provider might consider such improvements when calculating your premiums. You might end up paying less for your policy.

3. Increase Your Deductible

Deductible amounts refer to the money you pay out of pocket when initiating an insurance claim. Typically, the higher the deductible amount, the lower you're likely to pay as an insurance premium.

For instance, you could agree on a $500 deductible for a claim amounting to $5,500 worth of damages. Here, you'd first need to pay the initial $500 for repairs. Your insurer will then pay the remaining $5,000 to settle the claim.

Because your insurance company will pay the remaining amount after you meet your deductible, you're likely to pay less in premiums with a high deductible. The deductible amount varies from one company to another, so be sure to ask your insurer about the highest and lowest acceptable amounts. 



Although a higher deductible could have you pay less for the policy, you might want to increase the amount to a value you can afford when making a claim. If not, you could risk missing out on crucial repair work because you're unable to cover the deductible.   

You need first to understand your options if you want to get the most out of your homeowners insurance policy. You could talk to a trusted insurance agent and know what type of coverage fits your needs. Also, the agent may inform you of other types of discounts, depending on your policy. Feel free to reach out to Illinois Insurance Center to learn more about your options.