What Affects my Home Insurance Premium and What Discounts Can I Get?

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Usually when you get a mortgage your lender insists that you get some form of home and contents insurance to protect your interests. while you are not legally required to do so, having home insurance is a smart move to make to ensure that you are protected in the event that an emergency arises. However, you may be worried about the cost of having insurance on top of your regular monthly mortgage repayments. We will discuss the kinds of things that effect your home insurance cost and what kind of discounts you might be able to get that make home insurance as affordable as possible.

What Affects my Home Insurance Costs?

When you get insurance you pay something called a “premium” for coverage on the insurance plan. The amount of your premium is affected by a few key factors.

  • The amount actually insured on your home (and its contents if that is included in your plan. A higher amount insured based off of the value of your home and its contents will increase your premium.
  • Where your home is located matters as well. If you live in an area with higher risk of emergencies like flooding or wildfires that can increase your premium. If you live in an area that is prone to crime like burglary as well that can also increase your premium. For example, people who live in urban areas usually pay higher insurance premiums because cities tend to have higher crimes rates from burglar activity.
  • The type of cover you decide to use, and whatever discounts you might be eligible for

Keep in mind that just because an insurance premium is inexpensive, it does not mean that you will receive quality coverage. Because of this it is important to take the time to read through an insurers policy and make sure that it works for you.

What Discounts are Available to Me?

The discounts available usually depend on your insurance provider. Some examples of reasons why you might get a discount include:

  • You have made no previous claims or have made no claims in the past three years
  • There is somebody over the age of 50 living in your home
  • The residents of the house do not smoke
  • You are usually in the house during the day
  • The house has an alarm system in place
  • You have a smoke detector
  • You have security locks on your doors and windows
  • You have another insurance policy with the same insurance provider
  • Your house is in a neighbourhood watch area
  • You, as the applicant, are over 40 years old, or in some cases over 50 years old
  • The house is greater than 10 years old