Owning a home offers several unique advantages in terms of car insurance. Homeowners can take advantage of several unique discounts, lower fees, and insurance premiums. These discounts can often stack with one another, allowing you to have premiums that come at an incredibly low price.
What We'll Cover
- Maintain A Good Credit Score by Paying Off Your Home
- Take A Risk by Increasing Your Deductible
- Ask Providers About Multi-Policy Discounts
- Owning A Garage Is A Huge Plus for Homeowners
- Installing Home Security Systems On Your Property
- Planning And Reporting Your Commute Distance
- Multiply Savings With Multi-Car Discounts
There are several ways that owning a home can aid you in having lower car insurance. On the opposite end of the spectrum, failing to maintain many of these benefits may lead to your price increasing rather than falling. If you're interested in seven ways of owning a home that can affect your car insurance, stick around, and just keep reading.
Maintain A Good Credit Score by Paying Off Your Home
Owning a home is most often one of, if not the, most considerable asset any one person will have. If you have a mortgage and pay it on time every month, you are already doing enough to improve your chances at lower car insurance premiums.
Over an extended period, making on-time payments is the single best way to improve your credit score. Home mortgages tend to be agreements ranging from 10-30 years in some cases. Proving you can make those payments over months and years proves to auto insurers that you will pay their bills on time.
Every time you apply for insurance with a new company, they will do a credit check with three major credit bureaus. Having lousy credit from missed payments will drive premiums up or even lead to your being denied coverage by the agency.
Additionally, having no considerable credit may leverage against you. If you have no significant credit history, you can expect to have incredibly high premiums when purchasing insurance.
Don’t own a home yet? Check out how much mortgage you can afford on an income of $20k - $30k a year.
Take A Risk by Increasing Your Deductible
The deductible is the amount you pay before your insurance kicks in and begins to pay for your vehicle's damage. So long as you are confident in your ability to pay the deductible in the case of an accident, owning a home can allow you to have a higher amount.
With a higher deductible and more liability on you, your premiums will be lower. You can generally range your deductible from 500$ to the amount your car is valued.
Leverage Your Assets
Regardless of whether or not you have paid off your mortgage or are still paying your home, it is still considered an asset. Most often costing more than a car itself, you can leverage this enormous asset to allow you a much more substantial deductible.
A home's worth is calculated when an insurance agent is processing your payments and contract. Providing the proper documentation is essential but can allow you to pass asset checks on policies for more expensive or less insurable cars.
Ask Providers About Multi-Policy Discounts
Protecting your home is essential, and if you are going to have home insurance, there is a massive incentive for keeping all of your insurance with one company. Many insurance agencies offer multi-policy discounts in the form of lower payments and deductibles. Rolling your home and auto insurance into one can allow you to experience lower prices on both.
Companies such as Allstate advertise up to 10% off of auto and 25% off home insurance policies. Those savings can add up to hundreds of dollars a year over your insurance and car's life.
These benefits are much more significant than if you were to combine renters and auto insurance. Because renting is safer and is not offering any assets or credit incentives to the agency, it will naturally have a lower discount potential.
In addition to multi-policy discounts, you may also become eligible for loyal customer discounts. Some companies give these to those who have a low number of incidents over a long period of time, and because of the length of time you will own a home, these will naturally kick in but will require you to ask an agent when discussing premiums.
Owning A Garage Is A Huge Plus for Homeowners
Many homes, especially those in very dense urban areas, may require you to park on the street. Even covered parking in apartments is second to having a good garage. If you don't park your car in your garage or don't have one, even just having a driveway can lower premiums.
By parking on the street and near traffic, your car will be more at risk of accidents, even when you do not drive it very often. Scratches and dings from passing cars and the increased threat of intentional vandalism or outright theft all act to increase premiums.
When speaking to an agent, they will often ask where you will park your car regularly. You can expect your price to lower somewhere in the ballpark of 5% by parking in a garage. While not an earthshattering amount of a discount, it can add up quickly when combined with other tips on this list.
Having a garage or raised driveway can further reduce premiums throughout long term insurance prices. Because your car is off the street, and therefore more protected, it is less likely to suffer from passersby, thus lowering your maintenance costs and saving your undercarriage from rusting.
Humidity and water from splashing rain outside can cause unnecessary wear to your vehicle. Having a well functioning vehicle will lower your chance of accidents and reduce damage in the unfortunate event you need to use the insurance.
Installing Home Security Systems On Your Property
Installing cameras, sensors, or even just a security light can help improve your outdoor protection and lower your car insurance premiums via proxy. Many of the largest insurance agencies will offer you home or auto discounts for having your home secured.
If you do not have a garage or driveway, having security cameras and lights can help you prove your car is parked in a safe area if you can claim that a security discount is one of the better bargains.
Planning And Reporting Your Commute Distance
When purchasing a home, you may consider factors like the distance to work and family. When you apply for car insurance, you will be asked by the agent for the average mile usage on the car per month or year.
If your home is considerably closer, thus lowering mileage, you will have a smaller premium. The logic here is the less you drive a car, the less of a chance for an accident or equipment failure.
In addition to mileage, the location of your home can have an impact, either positively or negatively, on your insurance premiums.
Neighborhoods with lower crime rates, fewer car accidents, and more significant law enforcement presence tend towards offering a lower car insurance premium. That is not to say you should purchase a house solely to more down car insurance, but the location and your neighborhood can have a difference in what you pay.
Multiply Savings With Multi-Car Discounts
All of the discounts that apply to your auto insurance account stack on top of one another in order to lower your premium. As you can provide a safe place to park one car if you have more than one, the homeowner and safety discounts will apply to both vehicles.
While a discount may seem small on its own, you can have vastly higher savings by proportion by combining them and having more than one car. Most multi-car discounts range between 5-15%, and when combined with popular multi-policy, the value can be anywhere from 10-35% off what you would have been paying without a home.
To see how much you can save on your car insurance by being a home owner, compare quotes from multiple providers by clicking on the button below: