Homeowners insurance is a policy that protects homeowners against any damages or losses that may occur on their homes. Different homeowner insurances covers different losses and damages that may befall a house, taking into considerations different factors. This results to a noticeable difference in the cost of the insurance policy. As homeowners insurance is a very important factor of acquiring a home loan and a mean to protect your investment, its cost is a very important factor in determining whether you will acquire one.
To be able to know the average cost of the homeowners’ insurance policy, monthly and annually, we need to look at the factors affecting the policy cost.
The factors are:
People located in areas prone to perils; theft, storms, floods, earthquakes, fires andwinds are liable to pay very high insurance policies while those located in areas less exposed to these catastrophes are most likely to pay very low for their policies.
· Type of Policy
If the policy is bought to cover multiple risks (say storms, theft and fires), then the cost of the policy will be very high compared to a policy that covers a specific risk, theft alone, for instance.
Different insurance companies charge their policies differently. Look for an insurer that covers the most liabilities and charge fairly for them as opposed to one that covers a specific risk and charge highly for it.
For one reason or the other, you may end up owning a home in an area that is disaster prone and you have to protect yourself from paying too much for you policy. To avoid these pinching overpays, then you should consider:
· Expert insight
You should make your house more disaster resistant to pay less for your policy. Making your home more secure will also make it less prone to theft thus paying less premiums. Ask experts or your insurers what they recommend to avoid paying extra.
· Stay with the same insurer
Insuring your home with the same insurer you have been using for your other policies will make you a long time policyholder thus allowing you to receive discounts.
The average cost of the homeowner’s policy ranges from $500-$2000 per month due to the aforementioned factors. The cost varies from one place to another due to prevalence of risks. Homeowner’s insurance policy is one of the most important policies you can invest in and there’s no substitute for it. It protects you from the unexpected twists of life and unwelcome events that without this policy would leave you homeless.