Cape Coral Insurance Center

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Tips on “How to Reduce your Home Insurance Premium?”

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     If your home is in a flood zone where your mortgagee requires you to carry flood insurance, there is usually only one coverage the mortgagee cares about and that is the dwelling. One way to decrease flood premiums is to delete contents coverage from your flood policy. Obviously you have to be aware of what you are doing when you do this but it can make a big difference in your premium.

 

Bottom Line: There is clearly increased risk associated with this tactic but it’s true that it may be possible to decouple contents from the structure. If insurance coverage cost is your single biggest concern, your mortgage company only mandates dwelling coverage and you’re willing to accept the increased risk of losing your contents in an actual flood emergency it could be a viable option for you.

 

We’re discussing flood insurance because many existing policy holders are facing significant increases with renewals due to the Federal Flood insurance fund being significantly in debt ($25 billion) but its worth noting that this added layer of home insurance isn’t limited to just flood insurance. It’s common for home insurance policies to include liability insurance as a standard piece of the policy unless you specifically decline that coverage (and most mortgage companies don’t require it).

 

In other words… If you’re looking to save on home insurance policies and are willing to assume a bit more risk it could be a good idea to see what exactly is mandated by your insurance company and what you’re actually insured for. It could be a significant difference.

Written by Cape Coral Insurance Center

April 11, 2014 at 10:56 AM

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