How to Save on Home Insurance in Texas
In order to understand how to save on home insurance when buying coverage for a new home, or how to lower home insurance for an existing property - you need to understand what influences the cost of home insurance in Texas:
Home Insurance protects from financial losses if your residence gets damaged by a hazard or event covered by the policy. Home insurance comes in 4 distinct types of coverages:
- Homeowners insurance covers any (non-condo) residential property you may own.
- Condo insurance covers condo owners.
- Landlord insurance is for when you rent your home or condo to a tenant.
- Renters insurance is purchased by the tenant of any leased residence.
While all these coverages serve a bit different purpose, if you are looking to make your home insurance cheaper, the key variables under your control are:
- Age and condition of the property: Older and more susceptible to damage assets cost more to insure.
- Location: If you live in an area with less risk exposure to such things as floods, fires, tornadoes, and crime - you pay less.
- Proximity to local fire services: You pay less if your property is located close to a local fire service station and/or a fire hydrant on the street.
- Cost of replacement: If it costs more to replace your property, expect to pay more for additional coverage. As an example, the cost of new individual housing construction in Texas in 2021-2022 skyrocketed due to the shortage of lumber. As a result, if a home had to be rebuilt after an insurance claim, the rebuild cost was significantly larger than the outdated coverage in place. Make sure that your insurance coverage is sufficient to accommodate such market swings.
- Mode of replacement: Without modifying the overall insured value of the property, if you choose Actual Cash Value (ACV) replacement - the policy will become cheaper, but it will offer a drastically lower coverage than the Replacement Cost Value (RCV).
Note: In order to stay current and not overpay for the coverage that you do not need, homeowners should review their insurance coverages with the agent at least once per year.
You can further save money on home insurance if you do any of the following:
- Install protective equipment in your home/property, such as burglar alarms, sprinkler systems, and impact resistance roofing.
- If you stay claim-free for over three years, most insurers will offer an additional discount.
Speak with a Texas-licensed home insurance agent to discuss ways how to lower home insurance for an existing property or to help you save on home insurance for a home you are looking to buy or rent. A knowledgeable agent with access to multiple home insurance companies in Texas can offer a variety of home insurance quotes for comparison. Try to always compare at least 3 quotes.