1. Insure a home for its real estate value, not rebuilding cost. Insurance is designed to cover the cost it would take to rebuild your home rather than its market value. For many, this means that you may be able to decrease the current limit on your homeowners’ insurance coverage. However, before you do that, be sure to speak with a qualified insurance agent who can provide you with some direction on the proper limit for your home.

A better way to save on homeowner’s premiums: Raising your deductible is a much more accessible way to save some money on your homeowner’s insurance. Raising your deductible from $500 to $1,000 can save you up to 25 percent on your insurance premiums.

2. Selecting an insurance company by price alone. While most consumers seek to save money on their insurance premiums, it’s essential to carefully consider the insurance company you are placing your coverage with.   Do you know if they are financially sound? Have they had issues with peacefully resolving claims in the past? Do they provide the proper coverages without obscure exclusions that may eliminate coverage on your policy?

A savvier way to pick an insurer: Work with an independent insurance agent. An independent insurance agent can provide you with multiple insurance quotes from various top-rated insurance companies. They can provide valuable insight into the coverages each company offers and will be there as your advocate in the event of a claim.

3. Dropping flood insurance. While dropping flood insurance may be an easy option to consider as you are trying to save money on your insurance, keep in mind that flood is one of the most common claims homeowners experience (90 percent of all disasters involve flooding), and the damages from a flood can be devastating. Homeowners insurance doesn’t provide flood insurance coverage. Instead, flood insurance must be purchased through the National Flood Insurance Program.

A more innovative way to lower flood insurance costs: Before purchasing any new home, we recommend checking what kind of flood plain the home is in so you have a good idea of the associated insurance costs.

If you own a home in a flood zone, you still have some options: increase your deductible or help flood-proof by elevating the structure or other means.

4. Purchasing only the legally required amount of liability for your vehicle. Some consumers, to decrease their premiums, will lower the limits carried on their auto insurance to the state’s minimum required limits. As many states require limits of only $10,000 or $15,000, we strongly advise against this. One significant claim will immediately wipe out any limits, and you will be personally liable for the difference.

A less risky way to cut auto insurance costs: If you want to decrease your auto premiums, we recommend increasing your deductibles or taking a defense driving course.

5. Neglecting to buy renters insurance. If you are renting a home or apartment, you should never skip on purchasing homeowners’ or renters’ insurance. Most policies cost less than $200 annually and will cover all your property inside the residence. In addition to coverage for your contents, renters’ insurance policies also provide liability protection.

An excellent way to cut the cost of renters insurance is to look into multi-policy discounts. Buying several policies with the same insurer, such as renters, auto, and life insurance, will generally provide savings.

If you are looking for additional ways to save money on your insurance, please don’t hesitate to contact our office, and one of our representatives will be more than happy to assist.