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There are a lot of different factors taken into account that determine the homeowner’s insurance premium you pay. Let’s look at the main ones.

How Is My Home Insurance Premium DeterminedThe insured value. This is a pretty obvious one to start with, isn’t it? The most important point to make here is that there is no real benefit to be gained from insuring your property or possessions for a lower value than they are worth. You might get a slightly cheaper premium but in the event of a disaster you will be left without the money to replace everything.

The location. Another very important factor is where the property is situated. If the area is known to suffer from floods, tornadoes, earthquakes or other natural disasters then you can expect to pay a higher premium than someone who lives somewhere with less claims. The amount of theft claims made in the area will also be taken into account by the insurance firm’s premiums

Credit history. This is a factor which is taken into account in some parts of the world but not in others. If you have a poor credit history and live in a place where this is a factor in the premium then expect to pay more.

Occupancy. A home which you live in on a permanent basis will be cheaper to insure than one which is empty. This is because there is more risk of theft and also more risk of, for example, a fire running unchecked through the property.

What Else is Taken into Account?

Other factors. Many insurance firms give discounts to customers who have never had a claim, who have alarms on the property, have fitted high quality security locks or who are over a certain age. There may also be an additional amount charged for adverse features. This could mean a timber property, a flat roof or any other issue which doesn’t fit in with the insurance company’s idea of a typical property. These issues are seen as more of a risk because an incident could have more serious consequences than in a conventional property.

As we can see, there are a few things we can do to lower our insurance premiums, such as install an alarm or improve our security. However, the majority of the factors are to do with factors which we can’t really do much about.

Learn more about Louisville Homeowners Insurance from Claude Reynolds Insurance today!

By Matt Reynolds - Google+
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Claude Reynolds Insurance Agency Inc.
6801 Dixie Hwy Suite 232
Louisville, KY 40258
Phone: 502-933-2255
Fax: 502-933-5057
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