Research suggests that about 1 in 20 homeowners will make an insurance claim each year. So while it may seem that your monthly home insurance expenses aren’t worthwhile, the chances of needing your insurance are higher than you might think.
There’s are countless factors that influence your insurance rates, so here are few examples—some you’ve probably considered, and some that might be surprising.
Location: Some areas are simply naturally more prone to damage than others. Potential for weather and natural disaster-related damage will factor into your insurance, as will crime rates and fire protection. Don’t forget to talk to your insurance agent about flood zones and insurance during your inspection period!
Home value: This may seem like a no-brainer at first glance, but there are some extra considerations. The value of your home and the cost to replace your home from a total loss may not be the same—it can often cost more to rebuild.
Pets: Just like certain HOAs and neighborhoods forbid specific dog breeds, your insurance company may also increase your premiums for a specific breed. Breeds with reputations for being aggressive (fair or not) like pit bulls, German Shepherds, and rottweilers can cost you more.
Trampolines and swimming pools: All that fun comes at a price! Insurance companies see trampolines and pools as big risks for injury and even death, and that’ll affect your insurance rates.