Paying Too Much for Home Insurance?
There is no doubt that home insurance can be extremely expensive, but with the cost comes peace of mind. Your home is your most valuable asset, and there are a lot of amazing features that even the lowliest policy will provide you. Many people worry about losing their home to fire or natural disasters, which have both been covered by certain policies for many years now. However, having extensive coverage is not just about saving your house; it can also keep you from crushing financial burdens in the case of an emergency event due to something other than a natural disaster (like your health condition).
Unfortunately, many consumers spend way too much on what they think must be adequate coverage for their homes due to misconceptions about specific situations and cost estimates. Those who are paying a lot for their policies might be saving only about $50 a year, while those who are underpaying could be saving hundreds of times that amount. With that being said, let's review the most common misconceptions and how many people are paying far too much for insurance coverage.
The Cost of Home Insurance
Many people who purchase insurance for their homes often think that they have to come up with a large lump sum when purchasing it. They see that the minimum cost on the sticker that comes with their policy is $1,000 or sometimes even higher than what they actually paid for it. This type of thinking is why many people end up paying more than the actual value of their home. While it is true that some policies are priced in that manner, you can also get coverage at the minimal price of $100 or $200 a year.
For example, you can get a low cost homeowner's policy by having the right security system in place. One example of this security system is getting a LifeShield home alarm system , which is completely wireless and easy to install. Once it's up and running, you will be able to monitor your home via the Internet on your computer or mobile phone. The security system is also very affordable, running only about $25 a year.
You do not have to spend a large amount of money when getting the right coverage. Keep in mind that there are many types of policies available that can be purchased by anyone at any price they need. Just ask your agent what options you have and what coverage would be right for you. Home insurance becomes an interesting financial investment once you really start looking into it and start paying for more than just the minimum amount on the sticker.
The Cost of Living in Your Home
Insurance companies know that people will pay more to live in a certain area, even though it is not necessarily worth doing so. This is why many policies often have a higher cost in rural areas compared to urban ones. The same thing happens with a lot of people's homes, especially if they have built their life around them or only use them during the summer and all year long.
With this being said, living too close to the beach, for example, does not necessarily mean that you have to pay more for your home insurance. It just means that it will run higher even if you are in an area that is not as populated. If you live in a home that has plenty of square footage and is built well, it will still be worth paying for your home insurance. However, you should not pay a higher price to live in an area that is prone to flooding or extreme weather.
It is also important to note that crime rates do have an effect on your home insurance price. Being in a bad neighborhood with high crime and violence can lead to you paying more for your policy. Regardless of where you live, it is important that you know the local crime rates and look up the most dangerous neighborhoods in your zip code.
You can also save money on your premiums if you are willing to take out an alarm system on your house . They are known for making a lot of noise whenever someone tries to break in, which will definitely scare the burglar away before they get too far.