2 Interesting Things That Can Affect Homeowners Insurance Premiums
There are a variety of factors that can influence the cost of insurance premiums. Some homeowners are unaware of the factors that insurance companies take into consideration when deciding on premium amounts. Individuals who are looking for a home can benefit from knowing these things before they buy because it might affect their decisions to live in certain places. Those who are already homeowners can benefit from knowing what could cause their premiums to be higher because they might want to make upgrades to potentially lower their premiums. The following points represent a few factors that are used to formulate premium costs.
Age and Condition of the Home
Older homes may have higher insurance premiums if they have outdated features that could put the home at risk for damage. Some older homes have the original electrical and plumbing systems installed and are decades old. These outdated features may increase the risk of property damages such as electrical fires and water damage. Outdated electrical systems may feature fuse boxes instead of circuit panel boxes. Aged plumbing systems may have pipes that are prone to corrosion.
Individuals whose houses have aged roofing materials might also experience higher premiums. Roofing materials have estimated lifespans. Property owners can notify their homeowner's insurance company when a roofing upgrade has been made. This could lower premiums. However, if the materials are not replaced at the end of the estimated lifespan, individuals might experience a premium raise.
There are certain areas of the country that are prone to natural disasters such as earthquakes, tornadoes, hurricanes, forest fires, and flooding. Insurance for these areas is likely to be higher because no one can predict when these events will occur or the magnitude of damages. Individuals who do not have this risk might still experience higher premiums than other individuals in their jurisdiction.
A house fire can spread rapidly. Insurance companies use this factor to estimate how long it would take fire trucks to reach a residence. Individuals whose homes are not located near a fire station may have higher premiums. Investing in a security system that has features to notify the fire department when homeowners are away from home might reduce rates.
A homeowners insurance agent is a good resource to use to learn more about factors that can influence premiums. It is possible for premiums to go up due to changes in the economy. There are also ways to lower premiums such as bundling insurance products or making a home safer through upgrades.