Home insurance is often a must-have for homeowners, as it protects against potentially huge losses from surprise accidents or events.
If your policy’s premium is on the expensive side, it can eat into the household budget. But if you choose the cheapest home insurance policy, you may miss out on some crucial features.
So, if you’re wondering how to save on home insurance and find the perfect balance between cost and features, here are some tips:
Australia has a competitive insurance market and many insurers try to attract new customers with a variety of benefits to get their business.
Some insurers may offer special discounts to customers who have all their policies with the same insurer. This may include their car and house. This multi-policy discount can help to cut the price of premiums on all your policies, which could result in considerable savings.
If you’ve been with your insurer for many years, you may be able to negotiate a discount for your loyalty. Often the insurer won’t want to lose your business and will offer a premium reduction. Even a small discount of 5% or 10% on your premium can save you a fair amount of money.
Also keep in mind that if you’ve held an insurance policy for several years and haven’t made a claim, you may be eligible for a no-claim bonus or discount. Some insurers will even offer one of these no-claim discounts when you apply for a new policy if you can prove your claim history from your previous insurer.
‘Excess’ refers to the amount that you need to pay from your own pocket when you make a claim. Your premium can shrink considerably if you opt to pay a higher excess.
It’s important to remember that while increasing your excess can help you reduce your premium, you may have to pay a lot more if you make a claim. Some people consider this too much of a gamble, so it comes down to your personal level of risk tolerance.
To find out the amount and type of excess that is applicable for your policy, you can check your Certificate of Insurance.
When calculating your premium, insurers consider multiple factors, including how likely you are to make a claim. If you take proactive steps to protect your property from being broken into or vandalised, you may be able to reduce the cost of your home insurance.
If you’ve installed security and smoke alarms, deadlocks, security screens on all doors and windows, home monitoring systems and other security measures, you could ask your insurer whether they can reduce your home insurance premium.
The location of your house may play a significant role in your home insurance premium. If you choose a neighbourhood that has a high crime rate or where natural disasters are a frequent occurrence, it’s possible that your insurer will charge you a higher premium.
It may pay in more ways than one to investigate the location of your house thoroughly before purchasing.
There is a lot of variation in the cost of cover across the insurance market, and that’s before discounts are taken into account. It’s worth browsing your options before selecting a home insurance policy that suits your needs.
This article was reviewed by Personal Finance Editor Alex Ritchie before it was published as part of RateCity's Fact Check process.
