Shop around for lower insurance rates
Does it surprise you that Texas homeowners pay more for homeowners insurance than residents of any other state in the U.S.? You may wonder why residents of Florida, with all of its hurricanes, and California with earthquakes, mudslides and wildfires don't pay more. Average Texas rates easily surpass those states, though, according to information from the National Association of Insurance Commissioners. Weather is a major factor in the cost and Texas has historically had hail, hurricanes, tornadoes and floods.
Although insurance companies determine your rate by looking at data across the state as well as by zip code, there are steps you can take to make sure you're getting the best deal possible.
Consider the property
When purchasing a house, you may want to consider its age. The newer the home, the cheaper it usually is to insure. Also, when you purchase a new home, some insurance companies will give you a discount because they believe fewer problems will occur. Now that doesn't mean you should buy a new home solely because of insurance costs. But it is a factor to keep in mind.
When purchasing an existing home, you may want to inquire about that property's CLUE report (Comprehensive Loss Underwriting Exchange). Only the homeowner can order this report, so you must request it from the seller. The CLUE report will enable you to learn about the history of insurance claims for the property. Not only will a lengthy list of claims be of interest to you regarding the property's condition - it might have some bearing on premium costs and your ability to secure coverage.
Increase the amount of your deductible
The deductible amount you choose makes a significant difference in your premiums. The deductible is the amount of money you have to pay toward a loss before the insurance company will begin covering your claim. If you choose a higher deductible, you will save money on your insurance premiums. Basically the more risk you take on, the lower your premium will cost. But make sure you have the means to pay your deductible if a loss should occur.
Don't over-insure
When you are considering how much coverage to buy, don't include the value of the land. The land, for the most part, is not susceptible to damage like the structure of your home is prone to, such as hail, wind, theft, etc.
Use security devices
Many insurance companies will offer a discount - sometimes as high as 20 percent - when you install a security system that includes a burglar alarm to call the police. Even just installing deadbolts and smoke alarms can save you a few dollars. Before making a major change in your security measures, talk to your insurance company about what kind of discounts they offer and how much it would lower your premium.
Retire or kick the habit
Smokers typically have higher premiums because their homes are more susceptible to house fires than nonsmokers. Also if you are 55 years or older, ask your carrier if they offer a discount for seniors.
Use the same company for multiple policies
Some insurance companies give you a discount if you buy more than one policy from them, such as homeowners insurance and automobile insurance. This multiple policy discount can save you as much as 15 percent.
For more information about homeowners insurance, you can find a wealth of resources on the Texas Department of Insurance Web site, www.tdi.state.tx.us.
You can also talk with your Realtor. Realtors are knowledgeable about homeowners insurance and may be able to help guide you into making a decision that could save a substantial amount of money. Your Realtor understands insurance as well as all of the aspects involved with purchasing or selling a home. For more information about the home buying process, I invite you to visit TexasRealEstate.com or HAR.com or my site at danfrankrealty.com
For all of you Pearland TX Real Estate needs, contact the local Pearland real estate expert at http://www.danfrankrealty.com/
This column was published in the March 16, 2008 edition of the Galveston County Daily News
As an insurance agent I will say, "good post." While it's important to shop, understand every policy is different and has different limitations. While price is very important don't mistake coverage. The price you pay for the policy also includes the cost of unpaid claims! Many insurance agents don't recommend things like building code coverage or water back-up/sump pump coverage to keep costs down. These are usually minimal in cost but provide huge benefit when needed! I talk about this a bit on my blog at http://blog.AutoHomeLifeBusiness.com. Good job & have fun.