You can usually get home insurance discounts when you meet eligibility requirements set by your insurance company. In some cases, an insurer will automatically apply discounts based on your application information, but you may need to ask your insurer about other available discounts.
If you already have a policy, you can always contact your insurer to inquire about any discount opportunities that haven't been applied. This can be especially helpful if your home insurance policy is set to renew and you’ve made any updates, renovations, or changes in your situation that may lead to additional policy savings.
How do home insurance discounts work?
Home insurance discounts help you save money by reducing the cost of your premium. First, an insurer will calculate your base rates by weighing various factors, such as your property’s replacement cost, age, location, and claims history.
The insurer then uses information from your application to determine which discounts you qualify for. Discounts are generally percentage-based — e.g., 5% or 10% — and are deducted from your base rate to generate your final home insurance premium.
The type of discounts available, qualifying criteria, and discount amounts will vary by insurer. Even discounts offered by the same insurer can vary by state and policy type.
Common discounts for homeowners insurance
Home insurance companies offer various opportunities to lower your insurance costs. Some are based on your home’s characteristics, while others are rooted in policy features or your traits as a homeowner. Below, you’ll find common examples:
Home-based discounts
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Home security discounts: Theft is a leading cause of property claims. Homes with security features like burglar alarm systems, deadbolt locks, or security cameras usually qualify for discounts because they’re less likely to sustain losses from theft and vandalism. The same is often true for homes within a gated community.
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Fire safety discounts: Installing smoke detectors, sprinkler systems, and fire alarms or investing in a home security monitoring system can help lower your insurance rates.
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Renovated or new home discount: Newer homes and homes renovated to meet current building codes are less susceptible to damage and often qualify for discounts. Eligible upgrades and renovations can include installing a new roof, electrical system, or plumbing to comply with modern local ordinances.
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Green home discount: Several insurers offer deals to policyholders insuring environmentally friendly and energy-efficient homes. Some examples include discounts for smart home devices, efficient heating systems, solar panels, sustainable materials, and high-performance insulation.
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Water leak detection discount: Water damage can be costly, so insurers often reward homeowners who actively reduce associated risks. Many water detection systems send leak alerts through a smartphone app; some even have automatic water shut-offs to mitigate damage.
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Wind mitigation credits: Severe storms can cause significant wind damage, especially in coastal states. That’s why some insurers offer savings for wind mitigation efforts like fortifying your roof, installing storm shutters, or constructing a home that meets the Insurance Institute for Business & Home Safety standards.
Tip: In some cases, you may need to provide evidence that you meet the criteria for specific discounts, like a wind mitigation inspection report. Be ready to provide that information, whether you are purchasing a new policy or working with your existing insurer to review your policy.
Policy-based discounts
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Multipolicy / bundling discount: Purchasing two or more types of insurance products from a single insurer is one of the easiest ways to save on homeowners insurance. For example, you may get a discount if you bundle your home insurance with an auto, motorcycle, or life insurance policy.
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Loyalty discount: Many insurance companies offer loyalty discounts that reward you for renewing your policy for a consecutive number of years.
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Payment method discount: Home insurance companies may offer a discount based on how you pay. For instance, you could save by paying your annual premiums up front — rather than monthly or quarterly — or by signing up for autopayments.
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Paperless discount: Some insurers offer a discount if you choose to receive electronic statements instead of paper ones, as this lowers the company's administration costs.
Homeowner-based discounts
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Age or senior discount: Some companies see older policyholders, such as those 55 or older, as having a lower claims risk. Age eligibility for this discount depends on your insurance company, so it's a good idea to ask your agent if you qualify.
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Claims-free discount: Fewer or zero claims on your record typically indicate you’re less likely to file a claim in the future, which may result in a claims-free discount.
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Non-smokers discount: Smoking indoors increases the risk of accidental fires. Smoke-free homes are at a lower risk of fire-related claims, which can lead to a discount on insurance premiums.
4 steps to getting home insurance discounts
If you’re in the market for a new policy, these four easy steps can help you find potential discounts and lower your home insurance rate.
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Research insurance companies. Determine how much home insurance you need and any additional coverage you value, such as flood or sinkhole insurance. Identify insurers that can meet your needs and then review available discounts. Insurance companies often advertise available discounts on their websites, but you may have to call for more information.
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Gather information about your home. To apply for coverage, you’ll need details about your home, such as its square footage, roof composition, and year of construction. The insurer will use that information to determine your premium and discount eligibility.
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Familiarize yourself with common discounts. Many insurers offer the same or similar discounts, such as multi-policy or payment method discounts. Getting a general idea of what discounts are available can help you analyze insurers.
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Get quotes. Based on your research, compare home insurance quotes from at least three companies. In some cases, discounts are included in your original insurance quote, but you should contact the insurer directly to ensure all available discounts have been applied.
If you already have coverage, your existing insurer has likely applied any available discounts based on your most current information. However, it's always wise to periodically review available discounts and see if you’re eligible for additional ones. This is especially true if you’ve made any changes to your home during the policy term, such as adding security or fire protection systems.
Other ways to save on home insurance policies
Home insurance discounts can help lower your coverage costs but aren’t the only way to lower your rates.
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Improve your credit-based insurance score. In some states, insurers can use your credit-based insurance score, which is based on your credit history, to determine how likely you are to file a claim. The better your credit score, the lower your insurance premiums will usually be.
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Mitigate your risk. Insurance companies calculate premiums by evaluating risk and assigning lower rates to homeowners with fewer risks. Taking steps to mitigate risk, such as fortifying your home against common perils like theft, fire, and heavy wind, can lower your rate. It can also reduce the risk and severity of future claims, which can help keep your premiums lower.
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Shop around for coverage. Each insurance company calculates insurance premiums differently. Comparing quotes can help you get the lowest price for the coverage you need. For the most accurate comparison, ensure that each quote is for the same coverages, deductibles, and coverage limits.
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Increase your deductible. Your deductible, or the amount of money your insurer subtracts from a claims payout, affects your rate. Higher deductibles often lead to lower premiums. However, before increasing your deductible, make sure you can cover the additional out-of-pocket expenses after a claim.
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Review your policy annually. Evaluating your policy with an insurance expert every year is a good way to ensure your policy still meets your needs. You may find that you’re paying for coverages you no longer need. Cutting out any excess coverage can go a long way towards lowering your home insurance cost.
Common mistakes to avoid when seeking homeowners insurance discounts
Sometimes, efforts to lock in lower rates can put you at risk. Here are some mistakes to avoid.
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Being underinsured. Skimping out on crucial coverages to reduce costs can be a serious error. Being underinsured can lead to significantly higher out-of-pocket expenses after a claim or leave you financially vulnerable if you’re sued after a covered liability incident.
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Neglecting or failing to maintain your property. Regular maintenance and preventative measures lower your risk of filing a claim. Further, claims resulting from neglect or lack of maintenance may lead to steep rate increases, or your insurer may even deny coverage.
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Misrepresenting information on your application. Even if unintentional, insurance fraud can result in claim denials or future policy cancellations. To avoid issues when filing a claim, be as accurate and truthful as possible when filling out your application.