Alex Baglioni & Team RE/MAX Partners
Toll Free: 866-YOU-SOLD Ph: 954-229-0610 Fax: 800-743-1023
Offices in Fort Lauderdale, Las Olas, LightHouse Point, Plantation
Pembroke Pines and Coral Springs.
Hazard Insurance: Lower Your Cost


You may be able to save hundreds of dollars a year on homeowners insurance by shopping
around. You can also save money with these tips.

Consider a higher deductible. Increasing your deductible by just a few hundred dollars can
make a big difference in your premium.

Ask your insurance agent about discounts. You may be able get a lower premium if your
home has safety features such as dead-bolt locks, smoke detectors, an alarm system, storm
shutters or fire retardant roofing material. Persons over 55 years of age or long-term
customers may also be offered discounts.

Insure your house NOT the land under it. After a disaster, the land is still there. If you don't
subtract the value of the land when deciding how much homeowner's insurance to buy, you
will pay more than you should.

Don't wait till you have a loss to find out if you have the right type and amount of insurance.

Make certain you purchase enough coverage to replace what is insured. "Replacement"
coverage gives you the money to rebuild your home and replace its contents. An "Actual
Cash Value" policy is cheaper but pays only what your property is worth at the time of
loss-your cost minus depreciation for age and wear.

Ask about special coverage you might need. You may have to pay extra for computers,
cameras, jewelry, art, antiques, musical instruments, stamp collections, etc.

Remember that flood and earthquake damage are not covered by a standard homeowners
policy. The cost of a separate earthquake policy will depend on the likelihood of earthquakes
in your area. Homeowners who live in areas prone to flooding should take advantage of the
National Flood Insurance Program.

If you are a renter, do not assume your landlord carries insurance on your personal
belongings. Purchase a separate policy for renters.
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12 Ways to Lower Your Homeowner’s Insurance Cost


1. Shop Around
It'll take some time, but could save you a good sum of money. Ask your friends, check the
Yellow Pages or contact your state insurance department. For Florida, the phone number is
800-342-2762 and their website is www.fldfs.com. The National Association of Insurance
Commissioners (www.naic.org) has information to help you choose an insurer in your state,
including complaints. States often make information available on typical rates charged by
major insurers and many states provide the frequency of consumer complaints by company.

Also check consumer guides, insurance agents, companies and online insurance quote
services. This will give you an idea of price ranges and tell you which companies have the
lowest prices. But don't consider price alone. The insurer you select should offer a fair price
and deliver the quality service you would expect if you needed assistance in filing a claim.
So in assessing service quality, use the complaint information cited above and talk to a
number of insurers to get a feeling for the type of service they give. Ask them what they
would do to lower your costs.

Check the financial stability of the companies you are considering with rating companies
such as A.M. Best (www.ambest.com) and Standard & Poor’s (www.standardandpoors.com)
and consult consumer magazines. When you've narrowed the field to three insurers, get
price quotes.

2. Raise Your Deductible

Deductibles are the amount of money you have to pay toward a loss before your insurance
company starts to pay a claim, according to the terms of your policy. The higher your
deductible, the more money you can save on your premiums. Nowadays, most insurance
companies recommend a deductible of at least $500. If you can afford to raise your
deductible to $1,000, you may save as much as 25 percent. Remember, if you live in a
disaster-prone area, your insurance policy may have a separate deductible for certain
kinds of damage. If you live near the coast in the East, you may have a separate windstorm
deductible; if you live in a state vulnerable to hail storms, you may have a separate
deductible for hail; and if you live in an earthquake-prone area, your earthquake policy has
a deductible.

3. Don’t confuse what you paid for your house with rebuilding costs
The land under your house isn't at risk from theft, windstorm, fire and the other perils
covered in your homeowners policy. So don't include its value in deciding how much
homeowners insurance to buy. If you do, you will pay a higher premium than you should.

4. Buy your home and auto policies from the same insurer
Some companies that sell homeowners, auto and liability coverage will take 5 to 15 percent
off your premium if you buy two or more policies from them. But make certain this combined
price is lower than buying the different coverages from different companies.

5. Make your home more disaster resistant
Find out from your insurance agent or company representative what steps you can take to
make your home more resistant to windstorms and other natural disasters. You may be
able to save on your premiums by adding storm shutters, reinforcing your roof or buying
stronger roofing materials. Older homes can be retrofitted to make them better able to
withstand earthquakes. In addition, consider modernizing your heating, plumbing and
electrical systems to reduce the risk of fire and water damage.

6. Improve your home security
You can usually get discounts of at least 5 percent for a smoke detector, burglar alarm or
dead-bolt locks. Some companies offer to cut your premium by as much as 15 or 20
percent if you install a sophisticated sprinkler system and a fire and burglar alarm that rings
at the police, fire or other monitoring stations. These systems aren't cheap and not every
system qualifies for a discount. Before you buy such a system, find out what kind your
insurer recommends, how much the device would cost and how much you'd save on
premiums.

7. Seek out other discounts
Companies offer several types of discounts, but they don't all offer the same discount or
the same amount of discount in all states. For example, since retired people stay at home
more than working people they are less likely to be burglarized and may spot fires sooner,
too. Retired people also have more time for maintaining their homes. If you're at least 55
years old and retired, you may qualify for a discount of up to 10 percent at some
companies. Some employers and professional associations administer group insurance
programs that may offer a better deal than you can get elsewhere.

8. Maintain a good credit record
Establishing a solid credit history can cut your insurance costs. Insurers are increasingly
using credit information to price homeowners insurance policies. In most states, your
insurer must advise you of any adverse action, such as a higher rate, at which time you
should verify the accuracy of the information on which the insurer relied. To protect your
credit standing, pay your bills on time, don't obtain more credit than you need and keep
your credit balances as low as possible. Check your credit record on a regular basis and
have any errors corrected promptly so that your record remains accurate.

9. Stay with the same insurer
If you've kept your coverage with a company for several years, you may receive a special
discount for being a long-term policyholder. Some insurers will reduce their premiums by 5
percent if you stay with them for three to five years and by 10 percent if you remain a
policyholder for six years or more. But make certain to periodically compare this price with
that of other policies.

10. Review the limits in your policy and the value of your possessions at least
once a year
You want your policy to cover any major purchases or additions to your home. But you
don't want to spend money for coverage you don't need. If your five-year-old fur coat is no
longer worth the $5,000 you paid for it, you'll want to reduce or cancel your floater (extra
insurance for items whose full value is not covered by standard homeowners policies such
as expensive jewelry, high-end computers and valuable art work) and pocket the difference.

11. Look for private insurance if you are in a government plan
If you live in a high-risk area -- say, one that is especially vulnerable to coastal storms,
fires, or crime -- and have been buying your homeowners insurance through a government
plan, you should check with an insurance agent or company representative or contact your
state department of insurance for the names of companies that might be interested in your
business. You may find that there are steps you can take that would allow you to buy
insurance at a lower price in the private market.

12. When you’re buying a home, consider the cost of homeowners insurance
You may pay less for insurance if you buy a house close to a fire hydrant or in a community
that has a professional rather than a volunteer fire department. It may also be cheaper if
your home’s electrical, heating and plumbing systems are less than 10 years old. If you live
in the East, consider a brick home because it's more wind resistant. If you live in an
earthquake-prone area, look for a wooden frame house because it is more likely to
withstand this type of disaster. Choosing wisely could cut your premiums by 5 to 15 percent.


Remember that flood insurance and earthquake damage are not covered by a standard
homeowners policy. If you buy a house in a flood-prone area, you'll have to pay for a flood
insurance policy that costs an average of $400 a year. The Federal Emergency
Management Agency provides useful information on flood insurance on its Web site at www.
FloodSmart.gov. A separate earthquake policy is available from most insurance companies.
The cost of the coverage will depend on the likelihood of earthquakes in your area.

If you have questions about insurance for any of your possessions, be sure to ask your
agent or company representative when you're shopping around for a policy. For example, if
you run a business out of your home, be sure to discuss coverage for that business. Most
homeowners policies cover business equipment in the home, but only up to $2,500 and
they offer no business liability insurance. Although you want to lower your homeowners
insurance cost, you also want to make certain you have all the coverage you need.