Reviewing your home insurance policy probably isn't on your Top 10 list of things to do this spring, but it should be. You may be able to lower your insurance costs with careful shopping and inquiries.
First, find the policy and read it. You can't comparison-shop or ask for discounts if you don't know what coverage you have. If you don't understand your policy and what it covers, call your representative and ask.
You'll want to compare the limits in your policy and the value of your possessions at least once a year. It's important that your policy reflect any major purchases or additions to your home. But you don't want to spend money for coverage you don't need.
Armed with those basics, here are nine ways you may be able to lower your insurance costs. Keep in mind that insurance companies set their own discounts, so their offers will vary. When shopping, look at the overall package, comparing offers from several firms.
* Raise your deductible. The deductible is the amount you must pay before your insurance coverage kicks in. A typical deductible on a homeowner's policy is $250. But if you increase that deductible, you can save plenty of money, said Candysse Miller, spokeswoman for the Western Insurance Information Service, a nonprofit trade group. For example, raising your deductible to $500 could shave 12 percent off the cost of your policy. A $1,000 deductible, 24 percent.
Yes, you'll have to pay a bit more up front if you wind up filing a claim, Miller said. But you will be saving money in the long run with a lower premium. Of course, you'll want to make sure you can afford the out-of-pocket deductible.
* Secure your home. Installing burglar alarms, dead-bolt locks and smoke detectors can bring small discounts (about 5 percent each), depending on the company. You might be eligible for a larger discount if you put in a sophisticated home-security system. Allstate Insurance, for example, offers a 15 percent discount if you have a central alarm system that's wired directly to a fire or police department. Automatic sprinklers can cut up to 10 percent off your policy at State Farm. Check with your insurer before installing any system.
* Insure your house, not the land. Many homeowners erroneously think that because they paid $250,000 for their home, they need $250,000 in insurance. It's likely they don't need that much because they don't need to insure the value of their land.
"Dirt will burn, but so what," Miller said. Unlike your home, land isn't at risk from burglars or storms.
* Buy your home and auto policies from the same company. Some companies offer discounts of from 5 percent to 20 percent if you buy more than one policy from them. If you have homeowner's insurance and auto insurance from Allstate, for example, the company will give you a 20 percent discount on your homeowner's policy and an 8 percent discount on your auto policy.
* Renovate. Some home improvements qualify for discounts. Check with your insurer for details. At State Farm, for example, upgrades to plumbing, electrical fixtures and water lines can get you a 20 percent discount.
* New-home discounts. You might get a discount if your home is new. Allstate offers a 25 percent discount the first year you own your new home. After that, the discount falls 3 percent a year. Other firms offer similar discounts.
* Loyalty counts. If you've been with an insurance company for several years, you may be in line for a reduction. Some companies will reduce premiums by 5 percent if you stay with them for three to five years. If you remain a policyholder for six years or longer, you might get a 10 percent reduction.
* Senior citizen discounts. If you are at least 55 years old and retired, ask about a discount. Retirees are often home more, so they're more likely to spot a fire before it gets out of hand. Break-ins are less likely, too, because cars and people are home, Miller said. And retirees might spend more time on maintenance, she said.
* Other ways to save. Some companies offer discounts if all the residents in your home are nonsmokers. You also should check to see whether you are eligible for lower-cost group coverage through an organization to which you belong, such as a business group or alumni association.