Homeowner’s insurance providers are in the business of
managing risks. They sell you insurance at a price that
takes into account as many of the risks as possible
that you would face as a homeowner. That's why you might
pay more for your coverage if you live in an area prone to
tornadoes such as Kansas than your cousin in Wisconsin.
That one is obvious. But there are some not-so-obvious ways risk plays into home
insurance premiums as well. Believe it or not, if you have a good credit score,
you'll be judged as a lower risk than someone who doesn't pay his or her bills
on time or has a high debt/income ratio. Dogs are another tricky one: Some dog
breeds are judged as riskier pets than others. Swimming pools and trampolines
also are considered high risks by a provider, which means homeowners pay more
for coverage when they have them.
But there are ways to lower your risk in the eyes of insurance providers, too. One
of the best ways is by purchasing a home security system. Why? Consider these
statistics, courtesy of the FBI:
· A home burglary is committed in the U.S. every 13 seconds
·About 85% of break-ins are committed by nonprofessional criminals
·Law enforcement agencies clear only about 13% of all reported break-ins
· The average loss from a burglary is $2,185.
Now consider this statistic:
· Homes without security systems are up to 300% more likely to be broken into.
This should show you why your insurance agent will be happy if you tell him – and
you'll need a certificate to prove it – that you purchased a home security
system for your house. How happy will your insurance carrier be? You could
receive up to a 10% discount on your home insurance premium because of
The truth is, of course, that you'll get a lot more benefit from that saving. In
addition to greatly reducing the chance that your home will be targeted, you
also will have a backstop against a number of other problems. Most systems come
with smoke a alarm, which means you'll get an early warning of fire. That will
minimize the possibility of fire damage. Many come with options to add carbon
monoxide monitoring, as well as devices that warn you of flooding, freezing and
other threats to your home.
That's why your agent is beaming when you deliver the news. You've reduced a
number of potential risks by investing in that security system. That means you've
lessened the possibility that you'll have to file a costly claim. That makes your agent
and your carrier very happy.
This article was contributed by Carrie Van Brunt-Wiley, Editor of the
Carrie has been writing insurance news and consumer information for
HomeInsurance.com since 2008. She graduated from the University of North
Carolina in Wilmington in 2005 with a B.A. in Professional Writing and