Did You Say Discounts?

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While there is little you can do to change your home's location or basic construction (the main factors that determine your insurance rates), you can shave hundreds of dollars off your annual premium by taking advantage of the many discounts that nearly every insurer offers. Here are 10 typical ways to get a break.

1. The "In" Crowd
In almost any market, one company wants your business more than its rivals do. For example, you're highly desirable to some companies if you own a home in New York, Minnesota, Arizona, Illinois and Connecticut, where historical loss rates are low. Other insurers go after groups of customers they judge to be affluent and responsible, such as university alumni or membership organizations. The Hartford, for instance, has an arrangement to provide "lifetime continuation" coverage to members of the American Association of Retired Persons.

Travelers Property Casualty has affinity programs with several chapters of the American Automobile Association which earn members up to a 5% credit. How do you find these deals? Call your alumni association or any clubs you belong to to see if it has a deal with an insurance company. If all else fails, check with a local agent.

2. Security Counsel
When you installed that burglar alarm and those deadbolt locks, did you inform your insurance company? You should: Such home-security measures can earn you discounts ranging from 5% to 20%. Do you have a live-in housekeeper? In many states, Chubb will give you a 2% credit, since the presence of that live-in employee can reduce the chance of break-ins.

Your central alarm system could save you hundreds on your annual premiums. Insurers will routinely give you 15% to 20% off for a fire and burglar alarm system hooked up to a third-party monitoring company. At The Hartford, you can get a 2% discount for deadbolt locks and a 2% discount for smoke alarms. USAA gives 8% off for having a sprinkler system. Chubb and other companies give 5% discounts on homes equipped with closed-circuit TV cameras or outside motion detectors.

3. The Car Connection
Many companies give discounts of 5% to 15% off your homeowners policy if you combine it with your auto policy. The only time it may be cheaper to keep them separate is if your driving record has a recent blemish on it. You also may be able to get a discount if you have a policy for your boat, a package of riders, or an umbrella policy (which ups your liability coverage to $1 million) with the same carrier.

4. Adjustible Deductible
If you already have homeowners insurance, you probably have the standard deductible of $250, though some deductibles go as low as $100. But if you're willing to take a higher deductible, the savings can be substantial. With Safeco, by raising the deductible to $1,000, you can save 23% off your base premium. But you don't have to raise your deductible that high to realize significant savings. At Travelers, raising your deductible from $250 to $500 brings your annual premium down 10%. If you're willing to go from $500 to $1,000, you can save another 10%.

5. Out in the Country
If you live out in the boonies, be prepared to pay higher rates than folks who live in town. That's because it's harder for the local fire brigade to reach your home in an emergency. In most cases, you'll be bumped to a higher rate class if you live more than five miles from the nearest firehouse or more than 1,000 feet from the nearest fire hydrant. But rural-insurance specialist Old Guard Mutual of Lancaster, Pa., will give you the preferred rate even if you live miles from the nearest hydrant -- that is, as long as your home is within five miles of the local fire department and it has a tanker that can carry water to the fire scene. If you're determined to live in the country, don't count on finding a policy with a direct writer. Instead, work with a local insurance agent to price-shop among small mutual insurers that specialize in insuring dairy farms and rural homes.

6. The Slow Burn
If your house is constructed of fire-resistant materials such as brick or concrete, you've got money in your walls. You can earn a 15% credit with USAA and Nationwide if your home is "fire resistive" -- meaning the walls, floors, roof and ceilings of your home are constructed out of incombustible materials. Most companies give only a 5% discount if you have a smoke alarm, fire extinguisher and deadbolt.

7. New or Newish
Just about every insurer gives a discount for new homes. But only a few give discounts for homes that are merely newish. USAA offers up to 20% off on homes that are less than 10 years old. Have you upgraded electrical, heating and plumbing systems in that old house of yours? You're in luck: As far as Travelers is concerned, those renovations magically turn your old house into a new one and qualify you for a 15% discount.

8. Thank You for Not Smoking
A few insurers offer discounts to nonsmokers. Farmers, for one, gives a 4% discount as long as no one in the home smokes.

9. Customer Loyalty
As an incentive to stick with one carrier, some insurers offer discounts to customers who stay with the company for several years. State Farm offers 5% off if you stay with the company three to five years and 10% off if you stick around more than six years. You can earn a 5% discount if you have been with The Hartford for four or more years.

10. Modern Maturity
Reasoning that senior citizens are home more often and are better able to protect their homes against fire and burglary, some companies give substantial discounts to retirees. Travelers, for example, will give homeowners 50 and over up to 20% off in some markets.