Buying a new home includes multiple complex processes, such as setting up your homeowners insurance. According to MoneyGeek, about 93% of homeowners have insurance coverage, which demonstrates how essential it is. However, too many buyers don't pay attention to things like their premiums and get burned. Thankfully, we're here to help you understand your homeowners insurance plan premiums and help you save money when buying your first home.

What Is a Homeowner's Insurance Premium?

A homeowners insurance policy premium is the money you spend to keep your policy active. For example, in our team's experience, you might pay something like $50-$100 every month, $250-$300 every quarter, or $950-$1,000 every year. Bundling your payments into larger packages typically decreases how much you pay. Typically, these payments go directly to your policy provider, though some might get rolled into your mortgage payments.

How Are Premium Payments Decided?

Insurance companies decide premiums for homeowners insurance plans using a few metrics. These include your home's location, property values, and deductibles, as well as your credit score and claims history. Insurance premiums can sometimes fluctuate.

Can I Lower My Premiums?

After your provider sets your premium, you're often set with them unless you take a few steps. For instance, you can set a higher deductible, which is how much you pay when you make a claim. Homeowners often take this step because they know they're unlikely to make a claim on a home. However, you may regret it later if something does happen to your home. According to our experts, about one in 20 insured homes file some sort of claim annually. Before you begin with a plan, it's important to perform research and understand all of your options and the terms of your agreement.

This information should help you find homeowners insurance plans that make sense for your needs. Just as importantly, it can ensure you don't overspend on your policy and keep your premiums at a reasonable level. If you need help finding a policy for your home that makes sense for your needs, don't hesitate to get in touch with us today. Our team at Wilcox & Reynolds Insurance will sort through your options and provide you with the coverage you need to meet your needs.