Shopping around for the cheapest homeowners insurance policy may seem like a smart way to save money, but it could end up costing more in the long run.
According to the Virginia Corporation Commission, the most common mistake homeowners insurance shoppers make is not purchasing enough coverage. It's usually worth paying a higher premium for a solid insurance policy that will actually cover the value of your property if you need it.
With that said, however, just because you have a high premium doesn’t mean you have a good insurance policy. Not all insurance policies are equal, and having a thorough insurance agent working for you can make all the difference. It can still be helpful to the consumer to understand what types of things make your insurance cost more, and what you can do about discounts.
What can make my Virginia homeowner’s insurance premium increase?
U.S. homeowners pay $1,312 per year on average on homeowners insurance, with Virginia homeowners paying $1,013 per year on average. In the last decade, homeowners insurance costs increased across the country, leaving some people wondering why they’re paying more.
1. Adding a pool, hot tub, or outdoor spa
Your homeowners insurance should include liability coverage to pay for medical and legal bills if someone is injured on your property.
Insurance companies often suggest increasing the liability portion of your homeowners insurance coverage to cover the added risk that comes with owning pools, hot tubs, and outdoor spas.
2. Building a treehouse
Depending on your homeowners insurance policy, a treehouse may require more personal liability coverage and other structures coverage. Be sure to tell your agent if you have a treehouse or similar structure. If your homeowners insurance agrees to cover your treehouse, you can be protected if someone is injured in the treehouse or if it’s damaged.
3. Purchasing property in disaster-prone areas
If you live in an area that’s prone to flooding, fires, or other natural disasters, you’ll likely pay more for homeowners insurance. Climate change is increasing the frequency of these disasters and driving up repair costs for insurers, which means higher prices for homeowners.
4. Using a wood-burning stove
A wood-burning stove may increase your homeowners insurance costs slightly or you’ll need to pay an extra charge. Sometimes your home insurance provider will even send an inspector to check out your wood-burning stove to make sure it meets local fire codes.
5. Owning certain dog breeds
According to the Insurance Information Institute, dog bite insurance claim costs are on the rise across the U.S., and homeowners may see their insurance rates increase if they own certain dog breeds. The insurance carriers don’t have a vendetta against these breeds for no reason. The unfortunate truth is the data shows that certain breeds come with a higher risk of claims.
Virginia’s “One Bite” rule for dog injuries states that a dog owner is only liable for injuries if they knew the dog was dangerous or aggressive. The best thing to do is to inform your insurance agent of your pet so they can make sure you get the proper coverage. It's never a good idea to lie to your insurance agent or the carrier about your situation.
6. Your property’s proximity to a fire station
Your home’s fire risk plays a big role in how much you’ll pay for homeowners insurance. If you live far away from a fire station or fire hydrant, expect to see higher insurance costs than people who live closer to those services. Many rural homes have higher premiums simply because of this.
7. Getting a trampoline
A trampoline is another common attractive nuisance that could boost your homeowners insurance costs. In fact, some insurance companies will even refuse to cover trampolines.
8. Having outdated electric, plumbing, septic, or HVAC systems
Insuring an older home is often more expensive if critical features of the home are old and outdated. If your electric, plumbing, septic, or HVAC systems no longer meet modern building codes, your insurance will likely increase.
9. Bad credit history
Insurers generate a credit-based insurance score to set your insurance rates, according to the National Association of Insurance Commissioners. This score factors in things like missed bill payments, credit usage, and recent credit applications.
Some states restrict insurers from using credit scores to factor into their premiums. These states include California, Hawaii, Maryland, Massachusetts, Michigan, Oregon, and Utah. Virginia, however, does allow the use of credit scores.
If you have bad credit, you can usually still get insurance but your premiums may be higher.
10. Inflation and market changes
Your homeowners insurance rates will also grow with the rate of inflation, even if you don’t make any changes to your property. Annual inflation adjustments are usually 2-4%. This will be the case among all insurance carriers.
Rates can also increase if insurers see major losses from unusually large property damage claims or increasing construction costs. When insurers need to pay out more for damaged property, rates may increase across the board.
Common homeowners insurance discounts you should know about
Smart homeowners can take advantage of discounts to keep their insurance costs manageable while still maintaining enough coverage for their properties.
1. Replace your roof
Replacing your roof could lead to homeowners discounts from 5-35%. That’s because your roof plays a vital role in protecting your home from the elements, so keeping it well-maintained is very important.
2. Improve home security
A home security system protects you from losses due to burglary and accidents, which could lower your homeowners insurance costs. If you don’t want to invest in a fancy home security system, smaller upgrades like deadbolts, smoke detectors, and fire extinguishers can also help you save on insurance costs.
Before you install a new security system, check with your carrier first. They might only give discounts if you use certain brands or types of home security systems.
3. Raise your homeowners insurance deductible
Consider increasing your insurance deductible if you want to pay less for homeowners insurance each month. Although you’ll pay more out-of-pocket if your property is damaged, you could end up saving money if you don’t file a claim with your insurance company. In fact, some providers may offer additional discounts if you don’t file a claim for a certain period of time.
4. Bundle your insurance policies
Many insurance providers offer discounts for customers who purchase several insurance policies through them. Consider purchasing your auto, homeowners, and other insurance products through one company to take advantage of the discount.
5. Senior/retiree discounts
Senior citizens could qualify for homeowners insurance discounts, especially if they’ve worked with the same insurance provider for years.
6. Married couples discounts
Data doesn’t lie: Statistics show that married couples are more careful and file fewer insurance claims than people who are single, which could mean lower rates for married couples. If you are still riding along with an insurance plan you got before you were married, we recommend re-evaluating that. You can usually see a significant discount simply by bundling your insurance policies together with your spouse (including auto insurance) and letting your agent know you’re married.
7. Active duty military
Last but not least, your service to your country can get you a discount on your auto and homeowners insurance. Not all insurance carriers offer military discounts, but it's worth mentioning if you are active duty military when getting a quote from an insurance agent.
Find out why we are the trusted source for homeowners insurance in Virginia
Ronnie Shriner Insurance Agency has proudly served residents in Virginia since 1989. Based in Richmond VA, we specialize in tailored insurance plans based on each person’s specific needs, and we’re happy to help you select the best homeowners insurance option for you.