Buying a home in Metro-Detroit is a great long-term investment, and leaves you potentially sitting on a cash cow as the market begins to recover and home values rise throughout Michigan. Still, when you take out a mortgage to buy that first home, you also have to factor in the cost of protecting your new investment with homeowners insurance.
The premiums for a good homeowners insurance policy can cost you thousands of dollars per year depending on your coverage, and it’s not something you can do without. Insurance doesn’t have to be so pricey that it scrapes the bottom of your savings.
When insurers look at Metro-Detroit housing, they base premiums on things like square-footage, estimate rebuild costs, neighborhood data, localized dangers and relative crime statistics, potential for natural disasters and more. These things tend to be in a state of flux, so being proactive about your homeowners insurance now – as soon as you buy the home – can help you reduce your costs in the long run.
Just remember that reducing your insurance costs has nothing to do with cutting corners on your policy or coverage. There are better ways to reduce those premiums.
Maintaining a Healthy Credit Score
If you got a mortgage to buy Metro-Detroit housing, then there’s a good chance your credit is in decent shape, but it’s important to maintain it and try to improve it wear possible. Companies base their rates on your credit score, and every renewal period they can reassess your credit-worthiness to increase your premiums if they feel you’re a risk.
Seek out Discounts for Insurance on your Metro-Detroit Home
One of the best ways to get a discount is to ask for it – the worst they can say is “no”. Ask your provider if they offer reduced pricing for bundling services – such as with life insurance, auto and home. Bundling policies can bring savings of as much as 15%. In addition, there are loyalty discounts you may be able to build toward over the early days of your homeownership.
If you simply can’t work out a better rate with your provider, then take some time and shop around to see if you can find a better rate with similar or better coverage.
Boost your Deductible
While it may not be ideal if disaster should strike, increasing your deductible that you’re required to pay can dramatically impact your premiums. For example, a homeowner who increases their deductible on Metro-Detroit housing from $250 to $500 could save as much as 15% on monthly premiums. Raise it to $1000 and that percentage can almost double.
Disaster Proof your Metro-Detroit Housing
When you buy a home in Metro-Detroit, you expect it to be in relatively good shape unless you’ve invested in a fixer-upper. Even with a newer home there are things you can do/check to improve safety and help you avoid disasters. The bonus is that these actions can also decrease your insurance premiums.
Installing high-end fire-prevention systems, alarms, higher-quality locking systems, and shatter proof windows can net you discounts on your premiums anywhere from 5-25%.
Pay On Time for Better Rates
Providers like to know your payments will be consistent and they’ll get their money for the services rendered. Most will offer some kind of discount if you sign up for automatic bill-pay and go paperless. In addition, you may be able to get a significant discount on your policy by paying the entire policy off ahead of time.