For most, a home the largest financial investment you’ll ever make. But maintaining that home is also a big financial responsibility. One way to save some cash is by lowering how much you pay for home insurance.
Easier said than done, of course. The National Association of Insurance Commissioners reports that the average home insurance premium rose by 3.3 percent in 2014, and by 6 percent in 2013.
“Fortunately, certain home upgrades can lower what you pay for coverage,” says Elio Vecchiarelli, Managing Member at Blue Lion Insurance Advisors, LLC. “Some upgrades lower your premiums because they make it less likely you’ll need to file a claim in the future. And you’ll eventually have to pay for most of these anyway.”
Despite the up-front cost of these improvements, these upgrades can improve the safety of your home and lower your premiums:
1. A new roof
Unlike a shiny granite countertop or beautiful hardwood floors, a roof upgrade is easily overlooked. However, a new roof can greatly slash your premiums, sometimes by more than 10 percent.
“Insurance companies know that a new, professionally-installed roof is less likely to leak and better able to handle wind and hail than an old one,” Vecchiarelli says. “Your insurance savings will depend on the age and quality of the roof, but a typically discount after a roof upgrade is 5 to 10 percent.”
2. Central station alarm system
A comprehensive home security system will not only better protect your family and property, but your insurance provider may reward you with a lower premium. Some even include a sprinkler system and an alarm that rings at police or fire stations depending on the issue.
“Not every security system qualifies for a discount, but if you’re considering installing one, it never hurts to find out which systems might apply and how much you could save,” Vecchiarelli says.
3. New wiring
The National Fire Protection Association reports that between 2010 and 2014, an average of 45,210 house fires involved electrical failure or malfunction. Each year, this caused an average 420 deaths and $1.4 billion in property damage.
The math is simple: house + old wiring = fire hazard.
“Because old wiring is a major risk factor for a house fire, having your home rewired could save you big on your insurance,” Vecchiarelli says. “In the first year after upgrading, you could see a 5 to 10 percent discount on your premiums. The discount would likely be smaller—but still helpful—over the next seven years or so.”
4. Natural disaster preparation
Depending on where you live, you may be at a higher risk for hurricanes, flooding, wildfires, or other natural disasters. You may be able to save on your premiums by improving your home’s readiness for such an event.
Flood damage is all too common in coastal regions. Unless you have flood insurance, your home is not protected from damage caused by flooding. If your home is in a high-risk flood zone, consider installing proper flood openings and elevating your utilities above ground level.
“Some homeowners also benefit from adding storm shutters and doors, reinforcing the roof, or modernizing old plumbing and electrical systems,” Vecchiarelli says. “That can reduce the risk of fire and water damage and lower the cost to insure your home.”
Talk to the experts
Considering construction or upgrades on your home? Talk it over with a Blue Lion Insurance advisor. Let us assess your current home insurance coverage for free by calling (732) 649-1600 or contacting us today.