How to reduce your home insurance premiums

Lower your home insurance premiums with smart strategies. Learn how to cut costs while keeping your home protected. Read more.

By Thais On 6 de February de 2025

Understand what affects your premium

Before you start looking for ways to lower your home insurance costs, it’s important to understand what factors impact your premium. Insurers consider various elements when determining how much you’ll pay, including:

The location of your home
The materials used in its construction
Your claims history
The level of coverage you choose
The security features installed

By knowing what influences your insurance premium, you can take specific steps to make your policy more affordable.

Increase your excess

One of the simplest ways to reduce your home insurance premiums is by increasing your excess. The excess is the amount you agree to pay out of pocket before your insurance coverage kicks in.

If you choose a higher excess, your insurer sees you as less of a risk, which can lower your premium. However, it’s important to ensure you can afford the excess in case you need to make a claim.

Improve home security

Insurance companies reward homeowners who take proactive steps to secure their properties. By installing security measures, you can lower the likelihood of theft and damage, which may lead to a discount on your premiums. Some effective security upgrades include:

Installing deadbolt locks on doors and windows
Adding a monitored alarm system
Installing security cameras
Upgrading to reinforced doors
Using sensor lights around the property

Check with your insurer before making these upgrades to confirm which security measures qualify for a discount.

Maintain your home regularly

A well-maintained home is less likely to suffer damage that leads to insurance claims. Insurers often take the condition of your home into account when calculating your premium. To keep your insurance costs down, ensure your home is in good condition by:

Regularly inspecting your roof for leaks or damage
Keeping gutters clean to prevent water damage
Fixing plumbing issues promptly
Trimming trees to prevent storm damage
Repairing structural issues before they worsen

By keeping up with maintenance, you can reduce the risk of claims and demonstrate to insurers that your home is a lower risk.

Bundle your policies

Many insurance companies offer discounts if you take out multiple policies with them. If you also have car or contents insurance, consider bundling your policies with the same provider. This can lead to significant savings while simplifying your insurance management.

Pay your premium annually

Most insurers allow you to pay your premium either monthly or annually. While monthly payments may seem more manageable, they often come with additional administrative fees. If you can afford it, paying your premium in full each year could result in lower overall costs.

Compare different insurance providers

One of the best ways to ensure you’re getting the most competitive rate is to shop around and compare offers from multiple insurance providers. Prices can vary significantly between companies, even for the same level of coverage.

When comparing policies, don’t just look at the price—consider what’s included, exclusions, and customer service reviews. Some insurers may offer better coverage for a slightly higher price, which could save you money in the long run.

Ask about available discounts

Many insurance providers offer discounts that aren’t always advertised. When purchasing or renewing a policy, ask your insurer if there are any available discounts you qualify for. Some common discounts include:

No-claims bonus for homeowners with a clean claims history
Senior discounts for older homeowners
Loyalty discounts for long-term policyholders
Discounts for first-time homebuyers

It never hurts to ask, and even a small percentage off your premium can add up over time.

Reduce unnecessary coverage

While comprehensive coverage is important, you might be paying for extras you don’t need. Review your policy and assess whether certain add-ons are necessary for your situation. For example:

Do you need coverage for accidental damage if you’re careful with your belongings?
Is flood coverage necessary if you live in a low-risk area?
Are expensive valuables covered separately, or could they be insured elsewhere?

Customizing your policy to reflect your actual needs can help cut down on costs.

Avoid making small claims

Filing multiple small claims can increase your premiums over time. Insurers view frequent claims as a higher risk, which could lead to higher premiums or even policy cancellation. If possible, pay for minor repairs yourself and save your insurance for major incidents.

Consider switching insurers regularly

Loyalty to one insurer doesn’t always pay off. Many companies offer competitive rates to attract new customers but may not provide the same discounts to existing ones. It’s a good practice to review your policy each year and compare it with other offers in the market.

If you find a better deal, you can switch providers or use the competing offer to negotiate a better rate with your current insurer.

Understand the impact of inflation

Insurance premiums can rise due to inflation and increasing construction costs. While you may not have control over inflation, you can take steps to ensure you’re not overinsured. Regularly review your policy to ensure that your coverage reflects the current value of your home and possessions.

Reducing your home insurance premiums doesn’t mean sacrificing protection. By taking proactive steps like improving security, maintaining your home, comparing policies, and adjusting your coverage, you can find ways to lower your costs while keeping your home adequately insured.

Insurance is an important safeguard, and making informed decisions about your policy can help you save money without putting your home at risk.

Compare home insurance providers in Australia

Finding the right home insurance provider can significantly impact your premiums. Comparing policies from different insurers helps you find the best deal for your coverage needs. Here are some of the top insurance companies in Australia:

AAMI: AAMI offers a range of home insurance products with flexible coverage options. Learn more at AAMI Home Insurance.

NRMA Insurance: NRMA provides policies tailored to different housing types, with additional discounts for bundling. Find out more at NRMA Home Insurance.

Allianz Australia: Allianz is known for its comprehensive home insurance policies and competitive rates. Explore options at Allianz Home Insurance.

Budget Direct: Budget Direct offers affordable coverage with optional extras for added protection. Check their policies at Budget Direct Home Insurance.

Suncorp: Suncorp provides extensive coverage options with multi-policy discounts. Discover more at Suncorp Home Insurance.

By comparing policies from these insurers, you can ensure you’re getting the best value for your home insurance premium.

How to file a home insurance claim without increasing your premium

Filing a home insurance claim can sometimes lead to higher premiums, especially if you make multiple claims within a short period. To avoid unnecessary increases, consider the following steps:

Assess the damage and determine if the claim is necessary. If the repair cost is only slightly higher than your excess, it may be better to cover it yourself.
Maintain thorough documentation, including photos and receipts, to ensure your claim is justified.
Be mindful of your claims history, as insurers may view frequent claims as a higher risk.
Opt for a higher excess if you rarely make claims, as this can help lower future premiums.

Should you choose a basic or comprehensive home insurance policy?

Choosing between a basic or comprehensive home insurance policy depends on your budget, risk tolerance, and the level of protection you need. A basic policy typically covers essential risks such as fire and theft, while a comprehensive policy includes additional protections like accidental damage and weather-related incidents.

Consider the following when deciding:

Basic policies are more affordable but may not cover all potential risks.
Comprehensive policies provide broader coverage but come with higher premiums.
If your home is in an area prone to floods or storms, a comprehensive policy might be a better investment.
Compare different policies to ensure you get the best balance between cost and coverage.