How To Lower Your Homeowners Insurance Premiums Without Even Trying

January 29, 2007

I just received the best letter from my insurance company that I’ve ever seen. Here’s what they said:

“In a few days, you’ll receive your homeowners policy renewal packet. We recently changed the way we price homeowners insurance to ensure your premium reflects the risk your policy presents to us. As a result, your policy premium has decreased.”

No calling and haggling was required. I typically think of insurance companies as looking to collect the highest premiums they can and then deny as many claims as they can. This action proves that not all insurance companies fit that description.

What’s the Secret?
So how can you convince your insurance company to lower your home insurance premiums? Below are the reasons they listed for the drop in price.

  • Previous property insurance claims.
  • The age, location and construction features of your home.
  • Your coverage selections, such as limits, deductibles and special endorsements.
  • The fire protection of your property.
  • The length of time we’ve insured you.

Of course, the closing paragraph of the letter made me wonder if I have sufficient coverage.

“Know your coverage and make sure you’re adequately insured. As a policyholder, it is critical that you periodically review your policy to make sure you have enough coverage to rebuild your home if a loss occurs. Without adequate coverage, damage to your home could mean significant financial hardship.”

This could just be a marketing ploy in disguise. Lower the rates a little to make customers happy, and then make them worry they’re under insured so they increase their coverage. I’ll assume I’ve just been reading a lot of cynical stuff lately, that this move is on the up and up, and enjoy the lower premiums!


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Ben Edwards, the founder of Money Smart Life, saved up enough to buy a Nintendo back when he was 12 years old. When he used the money to buy shares of Wal-Mart stock instead, he knew he wasn't like the other kids... His addiction to personal finance has paid off for his family and now he's helping you to afford the life that you want. Check him out on the web at Google Plus, Twitter and Facebook.

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