6 Ways to Save on Homeowners Insurance

a small home with a red roof that has an umbrella covering it, illustrating effective ways to insure a home.

Homeowners insurance is an absolute must-have, but there are ways to make sure you’re paying as little as possible for this coverage. Even if you’ve already had homeowners insurance for some time, take these steps to reduce your insurance costs:

Compare Carefully

Whether you’re getting insurance for the first time or renewing for another year, it’s important to compare offers from multiple insurance companies.

This can be even more important if you’ve been with one insurance company for a long time; those premiums may have been creeping up over time and starting fresh with a new insurance provider can get you a fresh low rate.

Don’t just compare prices, however. Compare the policies and reputations of the different insurance companies you’re investigating. One company might be cheaper, but they may have a lot of complaints to your state’s insurance commissioner. You can also look online for first-hand accounts of other policyholders who’ve filed claims; how easy was the company to work with, and did they pay the claims promptly and in full, or were there delays and hassles?

One good way to get multiple quotes from different insurance companies is to use a broker or independent insurance agent. Independent agents sell policies from several companies, so they can present you with multiple options to choose from.

Change Your Coverage

There are lots of ways you can change your coverage to lower your monthly premiums:

  • Raise your deductible—once you’ve built up an emergency savings fund, you’ll have the cash on hand to pay a higher insurance deductible. A higher deductible means a lower monthly premium.
  • Remove anything you don’t need to cover—if you’re paying insurance to rebuild your house, it doesn’t have to include the value of the land your house is sitting on. Don’t pay for coverage for something that will never need to be replaced. Also, if you live in area where there are no hurricanes, earthquakes, tornados, etc., then you won’t need coverage for those kinds of events (most of those aren’t included in a typical policy, but if you’re paying extra for them and will never need them, change your coverage).
  • Change your coverage with other life changes—if you used to have a dog but no longer do, see if that will affect your insurance costs. Ditto for things that are no longer around—did you tear down an old barn or get rid of a swimming pool or trampoline? Chances are you were paying extra for owning those things. Talk about major life changes with your insurance company or agent—if your kids have grown up and moved out, does that change the coverage you need? Talk to your insurance representative to be sure you’re not paying more than you need to.
  • Do a home inventory—once you have accounted for all of your property, you can be sure you’re buying the right amount of coverage and not paying for more than you need. If you have high-value items like jewelry, you might need extra coverage, but if you ever get rid of those items, be sure to change your coverage to match and lower your monthly costs. Use an app to make the job of completing an inventory easier—take digital photos of everything and include serial numbers for any appliances or electronics.

Bundle Your Coverage

Usually you can save money by getting different kinds of insurance from the same company. Combining your auto and homeowners insurance from one provider can get you a nice discount.

Even with a discount for this kind of bundling, be sure to compare multiple offers. Sometimes you can get cheaper auto insurance from a second company even with the bundled discount from your homeowners insurance provider.

Also remember that extra kinds of insurance like boat & motorcycle insurance or life insurance can get you a discount for bundling.

Protect Your Property

Insurance protects your property from damage, theft or loss, so anything you can do to make that loss less likely can lower your premiums. Take some steps to reduce your risk:

  • Install new locks on your doors, buy a safe for valuables, and get hard-wired smoke detectors. These things make it less likely you’ll suffer from theft or a fire, so you can get a lower insurance rate. You’ll save even more if you have a security alarm system or sprinkler system for fire prevention.
  • Protect your home from natural disasters – install hurricane-rated doors to prevent wind damage, and add extra anchoring for your deck, etc. Depending on where you live, you can take steps to prepare your home from earthquakes, flooding, or other natural disasters. If you have wild brush on your property, clear out a radius from your house to prevent wildfires from spreading to your home.
  • Good fences can help with liability insurance—especially if you have a swimming pool on your property, make sure your fences are adequate to keep out children or other unwanted guests.
  • New wiring and heating/air conditioning systems can reduce risk of an electrical fire and maybe lower your insurance costs.

Anything you do to make your property safer and more secure could potentially lower your insurance risk and qualify you for a lower monthly premium. Be careful, though; if you improve the property so much that you make it more valuable, your premiums could go up instead of down.


Make sure you’re exploring all of the potential discounts available to you. We already talked about discounts for bundling multiple polices, but there are many more discounts you can ask about:

  • Does your employer have a relationship with a preferred insurance company?
  • Do you get a discount for loyalty? If you’ve been with your insurance company for a while and they’re not giving you a loyalty discount, feel free to shop around for a better deal elsewhere.
  • Have you not had any claims over a long period of time? Being “claim-free” for long enough can often get you a lower rate.
  • Did you retire or get married? Changing your work or marital status can affect your insurance for the better.
  • Do you have an HOA (Homeowners Association) or live in a gated community? You can get a discount due to the extra security these neighborhood features bring.
  • How do you pay your premium? If you pay every month, you might be paying more than if you make one yearly lump-sum payment. Talk to your mortgage lender about setting up an escrow account to pay your insurance annually to potentially get a discount. If you pay directly, setting up payments through automatic withdrawals from your bank account can often get you an extra discount.
  • Did you quit smoking? Smokers are deemed riskier for home fires by insurance underwriters, so quitting smoking should improve your insurance rates.

Keep Your Credit Good

Insurance premiums may be affected by your creditworthiness. Make sure your credit report & score look good, and you’ll avoid paying more than you have to.

Check your credit report regularly and look out for anything inaccurate or outdated. Also be careful about identity theft. Since the Equifax data breach a few years ago, we all need to be more diligent and check that our personal information hasn’t been compromised.

That makes it a good idea to go for something more intensive, like a credit report review or some sort of credit monitoring service. There was a time when not everyone needed these kinds of services, but sadly we now live in a world where everyone needs to take extra steps to protect their credit. And because credit has a direct impact on your credit worthiness, it’s really important to make sure your credit report looks good.

Learn more about credit reports and scoring from one of our free online courses, and contact us if you need any help keeping your credit reports and scores looking good.

If you are thinking of buying a home and have questions about homeowners insurance, talk to a homebuyer counselor before you get started on the buying process. Have your questions answered by an independent expert who will help ensure that you have a successful and stress-free journey to homeownership, and that you understand everything you need to know about getting the right amount of homeowners insurance without overpaying.

Article written by
Melinda Opperman
Melinda Opperman is an exceptional educator who lives and breathes the creation and implementation of innovative ways to motivate and educate community members and students about financial literacy. Melinda joined credit.org in 2003 and has over two decades of experience in the industry.

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