Owning a home is one of the best experiences you can have as an American citizen. However, policies can be quite confusing at times. At Focus Insurance, we specialize in providing a range of policies, such as homeowners insurance in Decatur.
And homeowners consistently have questions like, “What affects homeowners insurance and premiums?” So, in this blog post, let’s cover what four major factors determine the cost of home insurance. That way, you can have peace of mind that you’re protected.
The 4 Main Factors That Impact Your Home Insurance Rate
In essence, your risk profile determines your home insurance rate. This risk profile communicates how likely you are to experience a covered event or file a claim. For instance, if an insurer believes you live in an area with a higher probability of claims, then your home insurance rates will be higher.
That being said, let’s look at some specific factors, including the location that we just mentioned:
1. Zip Code / State
Two people living in Georgia won’t necessarily have the same home insurance rate. Your zip code and local municipality makes a difference as well.
This is because certain zip codes have a likelihood of theft, weather-related events, or even vandalism. This results in a higher premium.
By the way, the cost to replace or repair parts of your home based on their pricing and your location is something that goes into this calculation as well.
On the other hand, you could live in an area that has a positive impact on your rate, making it lower. For example, homes located by fire stations tend to have lower insurance premiums.
(Read more about fire damage and homeowners insurance here).
2. Dwelling Coverage
Dwelling coverage is what covers the structure of your home in your insurance policy. Insurance companies use calculation tools to determine your dwelling costs. An online quote tool or a live insurance agent will ask you questions to understand how much it may cost to rebuild your home.
So be ready with answers to questions about your plumbing, HVAC, roof materials, home materials, square footage, and even special features of your house, such as architectural characteristics.
3. Your History
Traditionally homeowners with lower credit have a higher probability of filing claims than homeowners with higher credit. Therefore, your credit history can positively or negatively affect your home insurance rates.
History of Claims
If you’ve filed homeowners insurance claims in the past, then insurance companies can seduce you to a more risky client. Based on these statistics, you’re more likely to file a claim again in the future.
4. Marital Status
Married couples typically enjoy lower insurance premiums than single homeowners. The home’s age. Older homes typically need to be brought up to code.
Many homeowners insurance policies include coverage to help you bring the home up to date based on local laws. For this reason, the older your home is, the higher your premiums are likely to be.
Additional Home Insurance Cost Factors
So aside from the main points above, what factors will affect the homeowners’ insurance cost? Let’s take a look:
The Type Of Homeowners Insurance Policy
There are various types of homeowners insurance policies available. They vary depending on the kinds of homes they cover, the perils covered, and the benefits they offer. Speak to a licensed insurance agent at Focus Insurance to understand your options.
Distance From Water
Being close to the coast can expose you to the hazard of hurricanes and other types of natural disasters. Even if you’re not near a large body of water, pools and playgrounds can also cause higher risk.
This is because these areas are potentially appealing and dangerous to children who could have an accident on your property.
Get A Quote Today
If you’re wondering what factors will affect the homeowners’ insurance cost, then you’re in the right place. Our expert agents are standing by to answer any questions you might have about home insurance policies, pricing, and coverage.
So reach out today and learn how you, your property, and your family can have the best policy for your needs.