4 ways to curb rising insurance costs

NEW YORK – June 8, 2012 – Homeowners’ insurance premiums have been on the rise lately with many homeowners seeing double-digit hikes and a rise in average annual premiums now over $1,000. Real estate professionals can help show their clients how they may be able to curb their homeowners’ insurance costs.

A recent article at Money Magazine offers the following tips:

Shop around. “If your rates rose 5 percent or more (in the last year), make sure to call the company for an explanation,” the article says. “Knowing whether the increase resulted from changes in your risk profile or from broad-based increases in the marketplace will help you negotiate and comparison-shop – which you should do at every renewal or at least every couple of years.”

Look for discounts. Bundling your home and auto insurance with the same insurance company could possibly save you up to 15 percent, for example. Insurers will also usually give a discount if you install a security system, storm shutters or new roof.

Evaluate the deductible. Most experts advise homeowners to go for the highest deductible they can afford in order to lower their premiums. But be sure to note that “many insurers are retooling deductibles from set dollar amounts to percentages, which can often represent a substantial change,” Money Magazine notes.

Base your coverage on the right number. Base your level on the recent per-square-foot replacement costs in your area, not on the home’s appraised value, says Kevin McCarty, president of the National Association of Insurance Commissioners. To obtain that information, check with the local homebuilders association.