How to Fight Rising Home Insurance Costs

Paying more for home insurance? You’re not alone. Home insurance premiums are on the rise, leaving many homeowners feeling the financial pinch.

Rate increases occur for a variety of reasons, many of which are out of your control. But there are a few things you can do to minimize your financial burden. Here are three tips to keep your home insurance more affordable:

1. Avoid high-cost areas.

If you’re looking to buy a home, it’s important to keep in mind that home insurance rates vary by location. Premiums tend to be higher in densely populated cities than in suburban and rural communities because replacement costs skew higher. Areas prone to natural disasters such as floods, wildfires, hurricanes and tornadoes command even higher rates — sometimes they’re denied coverage altogether.

2. Minimize liability risks.

Outdoor amenities like swimming pools and hot tubs can be appealing and even help boost a home’s value. But to insurance carriers, these are “attractive nuisances” that necessitate greater liability coverage. Even something as simple as a trampoline can create a liability that increases insurance costs. Asking your carrier about discounts for safety features like pool covers and fencing can help mitigate additional costs.

3. Renovate strategically.

Renovations can end up increasing your insurance premium and coverage requirements. For example, upgrading your flooring to high-end materials can increase their replacement costs. Adding a wood-burning fireplace creates additional fire risk, which impacts dwelling and liability coverage.

While you may not be able to avoid these cost adjustments, it’s not all bad news. Certain renovations can actually drive down insurance costs, such as upgrades to outdated roofing, plumbing and electrical.

Bonus Tip: Weatherproofing can be especially cost effective in at-risk areas. Ideas include fireproofing and sprinkler systems, water leak detection, hurricane straps and impact-resistant windows and doors.

Have a home improvement project in mind? Reach out to discuss your financing options.