As a consumer, you can take steps to make sure you're getting the best deal on your homeowners insurance. To start, check your premium and compare it to last year's premium. Companies are required to notify you of rate changes, but they don't necessarily spell out how much a premium is going up.
1. Evaluate deductible options. If you can save $500 or more over three to five years by increasing the deductible from $500 to $1,000, it's worth considering.
2. Notify your insurance agent if you update your heating, wiring, plumbing or roof. Credits may be available.
3. Notify your agent if you have added a central-station fire or burglar alarm. Credits vary, but range between 3 percent and 10 percent.
4. If you have been with the same carrier a long time, make sure the replacement cost shown for your house is in line with current construction costs and the replacement cost to assure the limit is adequate but not excessive. Your homeowners policy should not reflect the market value, but rather the replacement cost. Land is not a factor.
5. Avoid filing minor claims for problems not related to the weather because most carriers will increase your premium. Some carriers have filed surcharges in excess of 40 percent for new policyholders, and after filing a claim it is difficult to shop for new insurance. You could also lose the credit some companies give for you not filing claims for a certain period - a credit that can be as high as 20 percent.
If you are shopping for new insurance, weather-related claims may result in a surcharge. The carrier that pays the claim is prohibited from increasing the premium, but a new carrier is not.
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