There are few things more satisfying than owning a home. At the same time, there are also few things more demanding of your time and money. A crucial piece of owning a home is homeowners insurance. But a homeowners insurance policy isn’t cheap. The national average for a home insurance policy is $2,305 per year. One great tactic to keep down your costs is home insurance discounts.
By putting your savvy shopper skills to work, you can save hundreds on a home insurance policy.
Loretta Worters, spokesperson for the Insurance Information Institute, said discounts vary by company and state. You can add up multiple discounts and save.
“There are discounts such as bundling of policies, or security systems. If you’re 55 years old (or older) and retired, or you modernize your plumbing or electrical systems, you may qualify for a price break, too. Of course, the most important factor in deciding which company to select shouldn’t be based just on discounts, but on the financial well-being of a company (a rating of A- or better by a rating agency) and the service they provide.”
Key Takeaways
- Homeowners insurance is typically not required by law but is usually required by mortgage lenders.
- The national average for a homeowners insurance policy in the U.S. is $2,305.
- There are a handful of common discounts you can swoop in on to cut the cost of home insurance.
- Bundling your home and auto policies with one insurance company is one of the biggest ways to save on your premium.
20 common home insurance discounts
Discounts can feel like hunting for elusive, exotic animals in the wild. If you spot one, it could feel like an ephemeral thrill – and help add weight to your wallet. Let’s see how many you can collect by taking a look at the 20 common home insurance discounts, and the average percentage you can save off your premium:
- Advanced purchase discount: 9%
- Age of home discount: 11%
- Automatic payment discount: 3%
- Burglar alarm discount: 3%
- Claims-free discount: 5%
- Construction type discount: 7%
- Deadbolt discount: 1%
- Fire alarm discount: 3%
- Fire extinguisher discount: 2%
- Gated community discount: 4%
- Roof discount: 5%
- Loyalty discount: 6%
- New home discount: 40%
- Paid-in-full discount: 6%
- Smoke detector discount: 2%
- Sprinklers discount: 6%
- Storm shutters discount: 1%
- Upgrades discount: 6%
- Water safety system discount: 3%
Homeowners insurance discounts on roofs
Is your roof made of older materials? Another way to protect your home is by keeping tabs on your roof and updating it. A new, impact-resistant roof can save you an average of $115 a year. Among insurance companies, MetLife offers a 43% price break for a roof upgrade, which shakes out to $991 a year.
Homeowners insurance discounts on security systems
Keeping would-be home intruders can also help you save. Installing a burglar alarm can snag you an average of $69 in savings a year. Burglar alarms that contact a police station typically net a higher discount. Similarly, alarms linked to a central station, which is a central monitoring staff who will alert the police or the fire departments, on average offer a higher discount than ones that simply sound the alarm and don’t alert local authorities.
Homeowners insurance discounts for seniors
Being part of the 55 and up crowd can help you save up to 10, according to the Insurance Information Institute. If you are a senior, and particularly if you’re retired, you might be home more. The majority of residential burglaries occur during the daytime. In turn, you would have more time to make repairs and keep your home in solid shape. Plus, you most like would be able to keep a closer eye on potential problems sprouting up, such as a water leak or fire.
The Hartford/AARP is one carrier that offers a discount for seniors and retirees.
Homeowners insurance loyalty discounts
In matters of love and friendship, it often pays to be loyal. And this rings true for being a loyal customer, too. Home insurance companies want to keep you around. And to reward you, you could score $138 in savings a year.
You might also receive greater savings by hopping to a homeowners policy with a different carrier, so it doesn’t hurt to shop around. You do have the right to switch your insurance when you please, so doing a bit of comparison shopping regularly can serve your best interests.
Homeowners insurance paid-in-full discounts
As always, it pays to pay…in full. If you’ve got the means to cover the annual bill in one payment for your homeowner’s insurance, it’ll get you a discount. Plus, you get it out of the way and the company doesn’t have to “bug” you with those monthly bills. This could mean a $139 discount each year.
To pull this off, you can save ahead of time. For instance, set aside a certain amount from your paycheck each month, or when you receive a small windfall of cash by way of a bonus. Then, when it comes time to pay your premium, you’ll have enough to pay it in full.
How much can you save on home insurance discounts?
How much you save depends on which discounts you’re eligible for, and how much of a discount you’re likely to receive depending on the insurance company. You’ll scoop up the largest discounts by stacking as many as you can.
The biggest home insurance discount you’ll likely find is if you buy a newly built home. Insurers provide an average 40% discount to new homebuyers. That’s a savings of $922 on average. You’ll also save by bundling your policies. Having the insurance company provide both home and auto insurance gets you an average savings of 18%, cutting your bill by an average of $415. The third biggest way to save on your house insurance is linked to the construction type of your home. Fire-resistant or superior building materials get an average rate cut of about 11%. Masonry leads to an average 7% discount.
| Discount category | Type | Average discount |
|---|---|---|
| Advance purchase | 10+ days advance purchase | 9% |
| Advance purchase | 7 days advance purchase | 8% |
| Age of home | 5 years old | 26% |
| Age of home | 10 years old | 13% |
| Age of home | 15 years old | 4% |
| Age of home | 20 years old | 2% |
| Automatic payments | Electronic fund transfer | 3% |
| Bundle | Home and auto | 18% |
| Bundle | Home and umbrella | 4% |
| Bundle | Home and life | 4% |
| Burglar alarm | Police department | 4% |
| Burglar alarm | Central station | 4% |
| Burglar alarm | Local | 2% |
| Claims free | 5 year claims free | 5% |
| Claims free | 10+ year claims free | 5% |
| Construction type | Fire resistive | 11% |
| Construction type | Superior | 11% |
| Construction type | Masonry | 7% |
| Construction type | Frame – to 66% masonry veneer | 6% |
| Construction type | Frame – over 66% masonry veneer | 6% |
| Construction type | Asbestos/stucco | 4% |
| Construction type | Frame – to 33% masonry veneer | 2% |
| Deadbolt | Deadbolt | 1% |
| Fire alarm | Central station | 4% |
| Fire alarm | Fire department | 4% |
| Fire alarm | Local | 2% |
| Fire extinguisher | Fire extinguisher | 2% |
| Gated community | With patrol | 4% |
| Gated community | Without patrol | 3% |
| Hail resitant roof | Hail resistant roof | 5% |
| Loyalty | 10+ years renewal | 8% |
| Loyalty | 5 years renewal | 6% |
| Loyalty | 3 years renewal | 5% |
| New home | New construction recently purchased | 40% |
| Paid in full | Paid in full | 6% |
| Smoke detector | Smoke detector | 2% |
| Sprinklers | Sprinklers | 6% |
| Storm shutter | Storm shutters | 1% |
| Upgrades | Electrical, plumbing, heating done at once or over recent short period of time | 13% |
| Upgrades | Roof upgrade | 11% |
| Upgrades | Electrical upgrade | 3% |
| Upgrades | Plumbing upgrade | 2% |
| Upgrades | Heating upgrade | 2% |
| Water safety system | Water leak detection – shut off and alarm | 4% |
| Water safety system | Water leak detection – shut off | 3% |
| Water safety system | Water leak detection – alarm | 3% |
Best homeowners insurance companies for home and auto bundling discounts
Among the top three biggest ways to save on your homeowners insurance premium, bundling your home and auto might be the easiest and the one you have the most control over. You can’t really change how old your home is, or its construction type—at least not very easily. You most likely already have a car, and you don’t have to invest a small fortune in making upgrades.
Let’s take a look at the companies that offer the biggest discounts when bundling your home and auto policies:
| Company name | Avg rate after discount | % Savings |
|---|---|---|
| MetLife | $991.15 | 43% |
| Nationwide | $898.95 | 39% |
| United Farm Family | $760.65 | 33% |
| State Farm | $760.65 | 33% |
| Grange | $760.65 | 33% |
| American | $714.55 | 31% |
| CSAA Fire & Casualty | $691.50 | 30% |
| Massachusetts Bay | $668.45 | 29% |
| Farmers | $645.40 | 28% |
| State Farm | $645.40 | 28% |
Which states offer the biggest home insurance discounts?
House insurance policy costs vary by state. Per Insure.com analysis of the data collected on the top three insurance discounts, the top six states offering the most discounts are:
- Colorado
- Mississippi
- Nebraska
- Tennessee
- Wyoming
- Virginia
How to save more on home insurance rates
Here are some tactics on saving more on home insurance premiums:
Bundle, bundle, bundle. You can save by bundling your auto and home insurance. The insurance companies that offer the biggest discounts are MetLife ($991.15 average annual discount), Nationwide ($898.95), and United Farm Family ($760.65). Insurance companies might also offer savings if you bundle your home and life insurance, or your home and umbrella policies.
Shop around. You can cancel or switch policies, coverage amounts at any time. Take full advantage by looking for lower policies from other insurance companies.
Increase your deductible. To lower your premiums on any type of insurance policy, bump up your deductible. If you go this route, consider the costs you would need to cover should you file a claim.
Build your credit. An insurance company will look at your credit score during the underwriting process to figure out the cost of your policy. They use what’s called a credit-based insurance score. This looks at certain aspects of your credit to gauge how likely you would suffer an insurance-based loss. The better your credit score, the better your odds of having a lower premium.
Secure your home. Keeping would-be home intruders can also help you save. You can get a discount on homeowners insurance for an alarm system. Installing a burglar alarm can snag you an average of $69 in savings a year
Maintain and repair your home. Keeping your abode in tip-top shape can result in a no-claim period, or a discount from making upgrades to major home systems. When you make certain upgrades to your major home systems — think electrical, heating, and plumbing – or to your roof, you can save an average of $138 buckaroos. If you go for a one-two-three punch, and level up your electrical, heating, and plumbing at once, or within a short period of time – on average you can enjoy larger savings.
Frequently asked questions about homeowners insurance discounts
Which insurance company has the cheapest home insurance?
The home insurance companies with the least expensive home insurance premiums are:
- First Fire & Casualty of Hawaii (average annual rate: $514)
- New Jersey Manufacturers ($747)
- Vermont Mutual ($766)
- Farm Bureau Mutual of Idaho ($783)
- Concord ($884)
- West Bend Mutual ($884)
Going with a less expensive insurance company that provides coverage where you live and has what you need is a solid start to saving on your policy. That, combined with what discounts are available, can help put more in your wallet.
Do security cameras lower home insurance?
Security cameras could help cut costs on home insurance, but not in all cases. It depends on the insurance company. Plus, simply installing a bunch of cameras around your house probably won’t cut it. Security cameras need to be set up as part of a larger security system. Sound there be suspicious activity, the system can contact a police station. Or it should be connected to a central station, which is a central monitoring staff that will alert police or fire departments.
