How Can I Save Money on My Massachusetts Home / Homeowners Insurance?
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Make Sure You’re Not Over-Insured
Insurance is designed to provide you with financial protection against many what-if scenarios, and it’s good to have a policy in place to protect one of the largest assets you own. With some types of insurance, though, there’s a point at which you can become over-insured..
Being over-insured simply means that you have more insurance than you need. The result is that you’re overpaying for coverage.
This can happen with MA homeowner's insurance because included in nearly every policy is an inflation guard, which typically ranges from 2 - 8% depending on the policy. This is a useful coverage because most things, including homes, cost more to fix or rebuild over time.
A clear example of this is looking at census data where the median value of a single-family home in MA in 1970 was $63,000. If you purchased and insured your home in 1975 for around this amount, the same house in 2000 had a median value of $133,000. Without the inflation guard, your home would be severely under-insured.
However, a house in 1970 insured at $63,000 with a 5% inflation guard that compounded every year for 30 years would be insured for $259,310. Assuming no major renovations or additions added, this would be too much.
Inflation rates vary over the years, so it is suggested that you review the dwelling coverage (which is the cost to replace your home from the foundation up) every five to ten years to ensure it is in line. We at Savin Jones Insurance have software that can help calculate the home's estimated 100% replacement cost.
Install Home Security Devices
We at Savin Jones Insurance offer a discount on certain coverages within your homeowner's policy if you install a security device on your property. These discounts are typically a percent off relevant coverages, which tend to be property coverages and not liability coverage, but the savings can add up.
Exactly what security devices qualify for a discount and what that discount is, varies from one insurance company to the next. To make sure a particular security device will get you a discount on home insurance, contact Savin Jones Insurance before you install any device. Your agent will be able to check what your insurer will offer for a particular device.
Bundle Homeowners and Other Insurance
Most Massachusetts residents who own and insure a home also need Mass Auto / Car Insurance. If you need more than one type of personal insurance, bundling is an excellent way to save on two or more policies. When you purchase several policies from the same insurance company, they’ll usually provide a substantial percent-based discount on each policy that’s bundled together.
Business insurance policies usually can’t be bundled with Personal Insurance Policies like MA home insurance. There are plenty of personal policies that you might be able to bundle together, though. Ma Auto insurance and many more property and casualty policies might qualify.
Increase Your Deductible
A deductible is the portion of a covered claim that you are responsible for before the insurance company pays. It only makes sense that the higher the deductible, the less the carrier will have to pay, the lower the premium. Deductibles vary from some as low as $250 to as high as $5,000 (or higher on high-end homes.)
Though saving money is important, you want to pick a deductible that you can afford to pay should a claim occur. On the other hand, if you would never file a claim if the damage were less than $1000, don't have a $500 deductible. Pick the deductible that is right for you and your cash flow.
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