Only about 65% of Americans own a house. Are you planning to buy a home?

It’s a major investment, especially if you aren’t as well-off. If something untoward happens to your home, the financial consequences can be too heavy.

It’s why you must invest in home insurance to protect your property. In this guide, you’ll learn everything about home insurance rates.

Read on and find out more.

How to Calculate Home Insurance Rate

The average yearly home insurance rates by state are between under $1,000 and above $3,000. The primary driving force is the insurance company’s risk. It determines a homeowner’s likelihood of filing claims.

To determine risk, insurers consider the homeowner’s previous claims. They also think about the related claims to their property and their credit. The frequency and severity of the claim will also determine the rates.

Insuring a home with lots of claims in the past three to seven years increases your home insurance premium. It also includes the previous owner’s claim. If you bought a home with lots of recent claims, you might not even qualify for home insurance.

Other factors affecting the price include:

• Neighborhood
• Crime rates
• Building material availability
• Desired coverage amount

Your home’s condition also determines whether you qualify for home insurance. If you don’t maintain your house, you’ll lose a home insurance company’s interest. After all, it increases the insurer’s odds of paying on a damage claim.

How to Reduce Home Insurance Rates

While you compare home insurance rates, it’s better to cut down on insurance premiums. Learn the right questions to ask about homeowners insurance. After that, use the following tips:

1. Maintain a Security System

Get a burglar alarm you can connect directly to a nearby police station. It lowers your annual premiums by at least 5%. To get the savings, give the bill or contract proving your purchase.

Invest in smoke alarms, especially if you have an old house. You can save at least 10% more on yearly premiums. Install other simple security features like CO detectors and sprinkler systems.

2. Search for Multiple Policy Discounts

The best home insurance rates give discounts if you have other insurance contracts with the same company. Ask your health or auto insurance provider whether they offer home insurance as well. You’ll save more money if you have two or more premiums.

3. Plan Ahead for Renovation

Are you planning to add an adjacent structure to your home? If so, consider your materials to reduce the insurance premiums. Avoid wood-framed structures because they’re flammable.

Instead, make cement or steel-framed structures. They’re less likely to burn or degrade because of extreme weather. 

Get the Lowest Home Insurance Rates Now

With this guide, you learned how to determine home insurance rates. Never let your home’s condition ruin your chances of getting the best rates. Use our tips to keep your home insurance premiums low. 

However, knowing the rates is the start. You must learn to find the best home insurance providers in your area.

Do you need more valuable guides? Visit our website to learn more.