How to reduce insurance costs and save on auto and home

March 27, 2023

Learn about the best ways to reduce your auto and homeowners insurance costs

A couple high-five after reducing insurance costs

We've talked about both car insurance and homeowners insurance prices increasing across the country recently - an unfortunate reality for most Texans as the cost of everything seems to be going up. If you've found yourself looking at your bills and wondering, "How can I reduce my homeowners insurance?" or staring at a statement asking, "How can I reduce my car insurance?" - you're not alone.

While everyone is looking for ways to save money across the board, not everyone is aware of all the different ways they might be able to save on both their car and homeowners insurance policy.  That's why today, we'll take a look at some of the best options you have to help you save as much as possible! Read on!

How to reduce car insurance costs

Car insurance is increasing for many drivers across the country and state due to factors like inflation, the cost of auto parts and repairs, and even the cost of medical treatment. Although these things cause auto insurance costs to increase generally, there are still a number of things you can to save and keep costs down.

Here are some tips that can help you reduce your car insurance costs:

  1. Increase your deductible: Increasing your auto insurance deductible can lower your monthly premium. However, it's always a good idea to review this carefully and understand average repair costs for your vehicle so you're sure that paying a higher deductible fits within your budget if necessary. 
  2. Bundle your policies: If you have multiple insurance policies (such as auto, home, and life), consider bundling them with the same provider. Many providers offer discounts for bundling.
  3. Consider your car's safety features: Cars with safety features like airbags, anti-lock brakes, anti-theft systems, and passive restraints may be eligible for lower premiums.
  4. Drive safely: Maintaining a clean driving record with no accidents or traffic violations can help you qualify for lower premiums. You can also ask about safe driving discounts or claims-free discounts.
  5. Pay your premium upfront: Some providers offer discounts if you pay your premium upfront instead of in monthly installments. If you have the ability to do so, this can be a great option and has the added benefit of reducing the number of bills you have to keep up with each month. 
  6. Ask about other discounts: Many providers offer auto insurance discounts like:
    • Discounts for good grades (for students)
    • Discounts for completing a defensive driving course
    • Mature driver discounts
    • Customer loyalty discounts, renewal discounts
    • Claims-free discounts
    • Paid in full discounts
    • Multi-car discounts
  7. Consider your coverage needs: Evaluate your coverage needs to make sure you're not paying for more coverage than you need. For example, if you have an older car, you may not need collision or comprehensive coverage

How to reduce homeowners insurance costs

Like auto insurance, homeowners insurance costs have gone up recently due to inflation, the rapid increase in materials costs, and a national shortage in construction labor. But protecting your home with a homeowners insurance policy is something no one should go without, so it's essential to save when and where you can.

Here are some tips that can help you reduce your homeowners insurance costs:

  1. Increase your deductible: Your deductible is usually a percentage of your total dwelling coverage limit for your homeowners policy and like auto insurance, it can be adjusted to some extent. Increasing your deductible can lower your monthly premium, but again, it's important to thoroughly review this to ensure that paying this deductible out of pocket at some point is reasonable within your budget. 
  2. Bundle your policies: If you have multiple insurance policies, consider bundling them with the same provider as many providers offer discounts for bundling. Home and auto are commonly policies with bundling options, but carriers may have incentives for bundling life or umbrella insurance as well. 
  3. Improve your home's safety features: Insurance companies like to know that you're taking steps to keep your home safe! Making improvements to your home's safety features (such as installing smoke detectors, security systems, and fire alarms) can lower your premiums.
  4. Consider your location: Your location can impact your premiums. Homes located in areas prone to natural disasters or high crime rates may have higher premiums. While it's unlikely that you would move to a new location just to reduce your homeowners insurance premiums, it is something to consider if you're already house hunting and open to the idea of moving to a new area. 
  5. Maintain a good credit history: Many insurance providers consider your credit-based insurance score when setting your premiums. This isn't quite the same as your credit score, but both are based on your credit history. Maintaining a good credit history may help you qualify for lower premiums.
  6. Look for other discounts: Insurance providers often have a number of discounts available for homeowners insurance, just like auto insurance. For example, a provider might offer:
    • Discounts for having a new roof
    • Discounts for certain roofing materials
    • Discounts for newly constructed homes
    • Smart home discounts
    • Retiree discounts
    • Customer loyalty discounts
    • Claims-free discounts
    • Paid in full discounts
  7. Review your coverage needs: There are a number of different coverages within a standard homeowners insurance policy with a number of different coverage limits and sublimits. Evaluate your coverage needs to make sure you're not paying for more coverage than you need. For example, if you don't have valuable jewelry or collectibles, you may not need additional coverage for those items.

What's next?

Whether you're reevaluating your coverages and coverage limits, considering a higher deductible, or even shopping for a policy with a new carrier, it's important to fully understand what you currently have and how changing it might affect you down the road. For example, reducing the limit of your auto liability coverage may save you in the short term, but could wind up costing you way more in the event of an at-fault accident.

Similarly, it's important to consider the more intangible benefits an insurance provider might provide you. For example, if you've had a really positive experience when filing a claim with your existing provider, or if they've shown a quick turnaround time for their claims process, that could be worth paying a little more for - it's hard to place a price on great service, but you miss it when it's gone. 

Only you can decide what coverages work for you, but your local agent can help you better understand what you have and what you might need. While every insurance provider offers discounts of some kind, they can vary from company to company and your agent can help you figure out which discount options are available. 

Remember to review your policy regularly to ensure you have the coverage you need at a price that fits your budget!

Woman using calculator and pen

Whether you're looking for home or auto insurance, Germania is the Insurance Texans trust. For more information about our insurance products, check out our product page or request a free quote online today!

by Geoff Ullrich

About the Author

Geoff Ullrich is a writer and Content Marketing Strategist at Germania Insurance.

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