1. Shop Around
In addition to considering trusted opinions from your own personal network, you should get quotes from at least three homeowners insurance companies. You can start that process online, using resources that include sites such as ValuePenguin that allow you to gather premium quotes from multiple carriers.
Get a minimum of three quotes before calling a company and speaking to an agent. You want to have some idea of what your premium might cost before entering a sales call, and having those other price points can help you gain some negotiating leverage too.
Especially if extend beyond the minimum of three quotes, consider names other than the familiar home-insurance carriers. Many more companies than the State Farms and Nationwide’s are active in many states--more than 25 companies write homeowners insurance in Florida, for example, and 50 do so in California--and some may offer rates that match or even beat their bigger competitors. Many government regulators maintain online lists of insurers who write policies in their state.
2. Consider Being Loyal to Your Insurer
Make sure the companies you canvass for rates the one you’re now insured with, or ones you’ve insured with in the past. Homeowners insurance companies reward customer loyalty. As long as a policyholder is in good standing and remains claim-free, most insurers reduce the cost of their premium each year. The longer you remain claim-free and with the company, the greater the discount. For example, in California (and probably other states, too), State Farm offers as high a discount as 24% to customers who remain claim-free and have been with the company at least nine years.
Some stipulations may apply to these discounts. To be eligible for the State Farm reduction, for example, a policyholder must also have been claim-free during the five years prior to their becoming a policyholder with State Farm.
Another caveat: The loyalty discount alone does not assure you of lower premiums with each year. If the cost of your home insurance premium has indeed been gradually increasing, the discount could actually have been in effect, but has been offset by rate hikes due to the increased risk associated with insuring your ever-older home. Insurance companies usually apply a substantial discount to new homes, which they progressively reduce as the home and its infrastructure ages and become more liable to failures that can result in claims.
3. Claim Only When You Must
Remember that home insurance is a safety net, not a hammock. Your policy should only cover a financial loss that you otherwise would not be able to afford without compromising your lifestyle. That means you really should only file a homeowners insurance claim if you cannot reasonably afford the cost to repair your home out-of-pocket.
For one, filing a claim will likely exclude you from any claim-free discount. Keep in mind that many insurance companies offer a one-time discount to customers who have never filed a home insurance claim. The discount might lower the cost of a standard policy anywhere from 5 to 20% depending on the company. If you file a claim and negate that discount, the cost of your premium will increase.
Further, if you make multiple claims, your premium may change accordingly. For example, if you have been a policyholder with State Farm for less than 2 years and have one paid claim, your premium will increase 15%. If you have two claims within a three-year period it will go up 35%.