Remax sarnia realty inc., Brokerage
1319 Exmouth St. Sarnia,
ON, N7S 3Y1

Ryan Gervais

Ryan is a full time Sales Representative with Re/max and look forward to being your guide to the Sarnia Real Estate market

Saving Money on Home Insurance

no Comments In Insurance

Most people are always looking for ways to save a few dollars. Given the current economic climate, I think it happens even more today. Did you know there are a few safe ways you could save some money on your homeowner’s insurance? While each example is not applicable to everyone, one could be useful to you. Here’s a short list of some things that may help you.

1. House Value

Is your house insured to value properly? There are a number of cases where an insurance company will put the replacement value of their client’s house well over and above the actual cost to replace the building. The thing to keep in mind is that  in the event of a total loss where the house needs to be rebuilt (e.g. a fire), the insurance company will only pay to rebuild the house you had and nothing more.

Here’s an example. Let’s say your house is insured for $500,000. However after talking to a contractor, you find out that it would only cost $300,000 to rebuild it. This means in the event of a total loss the insurance company would only have to pay $300,000 and not the $500,000 you were covered for. In talking to your company you may be able to get the coverage reduced to the $300,000. Just bear in mind however, that by reducing your coverage to $300,000 you may be underinsuring yourself if let’s say it costs $350,000 to rebuild your place.

Part of the reason insurance companies will bring the value of your home well over the actual cost to replace it is that there is no incentive for them to have an accurate number. The lower the value of your home, the lower the premium of the policy. Therefore the higher the value, the more money they are bringing in.

2. Deductible

Could you consider moving to a higher deductible? If you increase your deductible you may be able to bring your premiums down. Just bear in mind that by increasing your deductible you won’t be able to put claims in for values below your deductible and you will need to have more money on hand in the event of a claim.

For those who have the cash on hand raising your deductible may be the right idea. Sometimes you can save hundreds of dollars per year just by raising your deductible by $500 or $1000. When making this decision you may want to think about how many years of savings it will take to make up for the change in your deductible. For example, if raising your deductible by $500 saves your $75 a year, it will take you 6.66 years to save the $500 more that you may have to pay in the event of a claim.

One of the questions you will have to ask yourself is how often do you think you will have a claim? Given the example above, if you think it will be more than every 7 years and you can afford a higher deductible, raising your deductible may be the right choice for you.

3. Endorsements

Have you considered tailoring your endorsements to match your exposure? Every insurance company will have different endorsements to cover different exposures. It’s important to find out which endorsements you have, whether they are set to the right amount of coverage and whether you need them at all. You could possibly save some money by reducing your coverage or removing an endorsement altogether.

Saving money is something that we all like to do. Whether it’s on gas, groceries, insurance or anything else, it feels good. Just make sure that when looking to save money, you don’t sacrifice quality. Have you ever had it where you purchase a cheaper grocery item to save you a few dollars only to find that when you bring it home you don’t want eat it because it tastes so bad? Insurance is much the same way. Make sure you’re buying a product from a company you can trust.

Ryan Gervais

Ryan Gervais is a full time multi-award winning agent who is here to help you through your real estate journey. Ryan's main passion is to protect his clients greatest investment by making sure you buy a great house for a fair price. Reach out today and see for yourself the difference a great agent can make.

(519) 381-4055

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