Recession and Homeowners Insurance Coverage- Not the Time to Skimp

During this tough economic time, homeowners across the country are looking for ways to cut back on costs and save on monthly bills. And while we are always trying to help homeowners save money- it’s important to emphasize that cutting back on homeowners insurance coverage is not a wise way to save. There are other ways to cut back on home insurance costs that don’t leave you uninsured.

First- Why Not to Cut Back
If you are not required to carry a minimum amount of homeowners insurance coverage  by a lender, your tendency right now may be to assume some risk and lower your  coverage to decrease your premiums. However, this type of risk is one that could cost you a great deal of cash in the event of a claim.

Historically, the occurrence of both burglaries and lawsuits increase during difficult economic times. Your contents and liability coverage may therefore be even more valuable to your now, than ever before.

Contents coverage is provided under a standard homeowners insurance policy and provides coverage for the personal belongings in your home such as clothing, electronics, furniture, etc.  Contents coverage offers protection in the event your home’s contents are damaged or lost due to a  coverered claim such as wind, fire, theft, etc. Cutting back on your homeowners insurance coverage means that you will have less coverage for your home’s contents in the event that you are the unfortunate victim of a home robbery.

Also, your liability coverage is the portion of a standard homeowners insurance policy that protects you financially in the event that you are presented with a lawsuit. Cutting back on your liability insurance could leave you exposed to assuming more risk considering lawsuits tend to increase during a recession.

How to Save the Right Way
You shouldn’t assume that the only way to save on homeowners insurance is to cut back on coverage. To save on homeowners insurance while still getting great coverage, ask your homeowners insurance agent about home insurance discounts. Find out what types of safety alarms and devices may save you an additional 10-15% on your homeowners insurance. Haven’t shopped your policy in a while? Use a comparative shopping site (like HomeInsurance.com!) and get some quick free rates to see if you are still getting a great deal on your coverage.