12 Ways to Lower Your Homeowners Insurance Premium

12 Ways to Lower Your Homeowners Insurance Premium

The average American homeowner pays about $1,900–$2,500 per year for homeowners insurance, and in some states (looking at you, Florida and Louisiana) it's double or triple that. The frustrating part? Many homeowners are paying more than they need to because they've never taken the time to optimize their policy.

Here's the deal: insurance companies want to keep your business, and they have dozens of discounts that they don't always advertise. If you spend an hour or two applying the strategies below, you could realistically save $300–$1,500+ per year on your premium. That's real money.

1. Bundle Your Home and Auto Insurance

This is the easiest and most impactful discount available to most homeowners. Almost every major insurance company offers a multi-policy discount when you bundle your homeowners and auto insurance with the same carrier.

Estimated annual savings: $200–$600

The typical bundling discount is 10–25% on your homeowners premium and 5–15% on your auto premium. For many families, that works out to $400–$600 per year in total savings. If you also have an umbrella policy, renters insurance on a second property, or boat/motorcycle insurance with the same carrier, the discounts may stack.

One important caveat: always compare the bundled price against the cheapest standalone policies from different companies. Sometimes two separate policies from two different insurers are still cheaper than a bundled package. Do the math both ways.

2. Raise Your Deductible

Your deductible is the amount you pay out of pocket before insurance kicks in. Most homeowners have a $1,000 deductible — but raising it to $2,500 or even $5,000 can significantly reduce your premium.

Estimated annual savings: $150–$500

Deductible	Typical Annual Premium	Savings vs $1,000
$500	$2,400	—
$1,000	$2,100	Baseline
$2,500	$1,800	$300/year
$5,000	$1,600	$500/year

The tradeoff: you need to be able to cover that higher deductible out of pocket if something happens. If you have an emergency fund with $5,000+ in it, a higher deductible is usually the smart financial move. You're essentially self-insuring the small stuff and only using insurance for major events — which is what insurance was designed for in the first place.

3. Install a Home Security System

Insurance companies love home security systems because they reduce the likelihood of burglary and break-in claims. Most major insurers offer a 5–20% discount for monitored security systems.

Estimated annual savings: $100–$400

What qualifies for a discount:

• Professionally monitored system (ADT, Vivint, SimpliSafe Pro Monitoring) — largest discount, typically 15–20%
• Self-monitored smart home system (Ring, Nest) — smaller discount, typically 5–10%
• Smoke and CO detectors — Especially connected/monitored ones, 2–5% discount
• Water leak sensors — Increasingly common discount, 2–5%, since water damage is the #1 homeowner claim

The irony? The insurance discount often pays for the security system itself. A basic monitored system costs $15–$30/month, and the insurance discount can be $200–$400/year. Learn more in our smart home security guide.

4. Maintain a Claims-Free Record

Many insurance companies offer a claims-free discount that increases the longer you go without filing a claim. After 3–5 years with no claims, you could see a 5–20% reduction in your premium.

Estimated annual savings: $100–$400

This is why it's often NOT worth filing small claims. If you have $2,000 in damage and a $1,000 deductible, the insurance company would pay you $1,000 — but filing that claim could increase your premium by $300–$500 per year for the next 3–5 years. That's $900–$2,500 in higher premiums to collect a $1,000 check. Not worth it.

Rule of thumb: Only file claims for damage that significantly exceeds your deductible — generally 2–3x your deductible amount or more. For smaller damage, pay out of pocket and protect your claims-free discount.

5. Improve Your Credit Score

In most states (California, Maryland, and Massachusetts being notable exceptions), insurance companies use your credit-based insurance score to set your premium. A higher credit score = lower insurance costs. It's not the same formula as your FICO score, but they correlate closely.

Estimated annual savings: $200–$800

The difference between "excellent" and "poor" credit can mean a 40–100% difference in homeowners insurance premiums. For someone paying $2,000/year, improving from fair to good credit could save $300–$600 annually.

Quick ways to improve your credit score:

• Pay all bills on time (35% of your score)
• Reduce credit card balances below 30% of limits (30% of your score)
• Don't close old credit accounts (length of credit history matters)
• Check for errors on your credit report and dispute any inaccuracies

6. Upgrade Your Roof

If your roof is aging and you're planning to replace it anyway, choosing impact-resistant shingles (Class 4 rated) can earn you a significant insurance discount — 5–35% off your premium, depending on your state and insurance company.

Estimated annual savings: $100–$700

Class 4 impact-resistant shingles cost about 20–30% more than standard shingles, but the insurance discount over the life of the roof (25–30 years) often more than pays for the upgrade. In hail-prone states like Texas, Colorado, and Minnesota, the savings are even more dramatic.

Even if you're not replacing your roof, just having a newer roof (less than 10 years old) typically earns a better premium than an older roof. Check our roof replacement cost guide for current pricing.

7. Get a Wind Mitigation Inspection

This one's especially valuable if you live in a coastal or hurricane-prone state (Florida, Texas, Louisiana, the Carolinas). A wind mitigation inspection documents the wind-resistant features of your home — roof shape, roof-to-wall connections, opening protections (shutters, impact windows), and roof deck attachment.

Estimated annual savings: $500–$2,500 (in coastal states)

The inspection itself costs $75–$150, but the premium reduction it unlocks can be massive — especially in Florida, where wind mitigation discounts can reduce your premium by 20–45%. Even if your home already has some wind-resistant features that you didn't know about, getting them documented and submitted to your insurer can trigger significant savings.

8. Ask About Loyalty Discounts

Some insurance companies reward long-term customers with a loyalty discount — typically 5–10% after 3–5 years with the same insurer, increasing over time.

Estimated annual savings: $50–$250

However, loyalty isn't always rewarded fairly. Some insurers actually raise rates on long-term customers more aggressively because they know most people won't bother shopping around. If your premium has increased significantly over the past few years, it may be time to get competitive quotes — even if you've been with the same company for a decade.

9. Comparison Shop Every 2–3 Years

This is probably the single most effective strategy on this list. Insurance pricing is dynamic — companies adjust their rates based on claims data, competition, and market conditions. The cheapest insurer three years ago might be the most expensive today.

Estimated annual savings: $200–$800

Get quotes from at least 4–5 companies, including:

• Your current insurer (ask them to re-rate your policy with all available discounts)
• 2–3 major national carriers (State Farm, Allstate, Liberty Mutual, USAA if eligible)
• 1–2 regional or local insurers
• An independent insurance agent who can shop multiple carriers for you at once

For a comprehensive understanding of what your policy should cover, read our homeowners insurance guide.

10. Install Smart Home Devices

Beyond security systems, several smart home devices can earn you insurance discounts because they help prevent common claims:

Estimated annual savings: $50–$300

• Smart water shut-off valves (Flo by Moen, Phyn) — Detect leaks and automatically shut off water. Some insurers offer 5–10% discounts for these.
• Smart smoke detectors (Nest Protect, First Alert Onelink) — Send alerts to your phone, 2–5% discount.
• Smart thermostats — Some insurers give small discounts for freeze protection features that prevent burst pipes.
• Video doorbells and cameras — Deter theft and document incidents, 2–5% discount with some insurers.

The total discount from having a comprehensive smart home setup can add up to 10–15% off your premium. See our smart home security guide for product recommendations.

11. Weatherproof Your Home

Certain home hardening measures not only protect your property but also qualify for insurance discounts:

Estimated annual savings: $100–$500

• Storm shutters or impact-resistant windows — 5–15% discount in wind-prone areas
• Reinforced garage door — Can earn a specific discount in hurricane-prone states
• Roof straps/clips — Retrofit metal connectors that secure your roof to the walls, qualifying for wind mitigation credits
• Fire-resistant siding and landscaping — Discounts available in wildfire-prone areas of California, Colorado, and other western states

12. Review Your Coverage Annually

Many homeowners set up their insurance policy when they buy the house and never look at it again. That's a mistake. Your coverage should evolve as your situation changes.

Estimated annual savings: $100–$500

Things to review annually:

• Dwelling coverage amount — Is it still accurate for today's rebuilding costs? Over-insuring is just as wasteful as under-insuring.
• Personal property — Have you sold or given away high-value items that you no longer need covered?
• Riders and endorsements — Do you still need that jewelry rider if you sold the expensive watch?
• Available discounts — Ask your agent: "Am I getting every discount I qualify for?" This one question has saved people hundreds.
• Liability limits — Make sure they're appropriate for your current net worth.

Total Potential Savings

Strategy	Estimated Annual Savings
Bundle with auto	$200–$600
Raise deductible	$150–$500
Home security system	$100–$400
Claims-free record	$100–$400
Improve credit score	$200–$800
Roof upgrade	$100–$700
Wind mitigation	$500–$2,500
Loyalty discount	$50–$250
Comparison shopping	$200–$800
Smart home devices	$50–$300
Weatherproofing	$100–$500
Annual review	$100–$500
Total potential savings	$1,850–$8,250/year

The bottom line: Most homeowners are leaving $500–$1,500 per year on the table in insurance savings. It takes a little effort upfront, but once you've optimized your policy and set up the right discounts, the savings continue year after year. Over a 10-year period, that's $5,000–$15,000 back in your pocket.