Before you compare home insurance quotes any further, first listen to this news flash. Did you know that many home insurance companies offer discounts to customers that aren’t carrying a mortgage? What this means is that if you’ve recently paid off your house and are still paying the same amount of money for your home insurance premiums, you might be paying far too much.
The main reason homeowners who have their houses paid off get home insurance at cheaper rates is because they’re seen as less of a risk when it comes to insurance claims than, say, someone who is upside down in debt.
This nugget of information probably comes as a big surprise to those who haven’t carried a mortgage in years but have been paying the same rates as everyone else. It might even be cause for a bit of justified anger. But is it really the insurance company’s fault? Think about it. Unless you inform your home insurer that you’ve paid off your house, they have no way of knowing.
If anything, this scenario serves as a perfect example of why it’s important to review your home insurance coverage every year, and to take into consideration what are called “major life events”—and if paying off your mortgage isn’t a major life event, then what is?
Even if you’re fully satisfied with your current home insurer, it’s smart to compare home insurance quotes on a regular basis. You don’t have to make this a weekly hobby, but doing so once a year—maybe a month ahead of paying your yearly premiums, for example—is a smart idea.