Home-Insurance Credits

Homeowners often don't take time to reassess home-insurance coverage when it's time to pay the premium. But with many Americans looking for ways to save a buck these days, examining that paperwork could pay off.

While raising the deductible is often an easy way to reduce premium costs, it isn't the only way. Discounts in the form of credits are also available for many homeowners.

"Credits can really add up and become substantial," says Pete Spicer, vice president and new product manager for Warren, N.J.-based Chubb Group of Insurance Companies.

A renovated-house credit, for example, is available through Chubb for homes that have been renovated in the last 10 years. Those eligible to take advantage of that credit may shave off as much as 10% of their premium if the renovation occurred in the last year.

It's likely that some of these breaks will be brought to your attention by your agent, says Dick Luedke, spokesman for Bloomington, Ill.-based State Farm Insurance, but it doesn't hurt to ask about them yourself if you think you may qualify.

Below are five home-insurance credits that are offered. Availability and eligibility will vary by carrier.

Security Protection Credit

Many carriers offer a credit if a home has a functioning security system, with the amount of the credit dependent on the type of system. According to the Insurance Information Institute, homeowners can often get at least 5% off their bill for a smoke detector, burglar alarm or dead-bolt locks. Add a sophisticated sprinkler system and a fire and burglar alarm that rings the police, fire department or another monitoring station, and you may be in for a premium reduction of as much as 15% or 20%, according to the institute.

Central Monitoring

Central monitoring systems can shut off the water if there's a leak detected while the homeowner is away, or raise the indoor temperature if it moves out of a specified range. Chubb, for example, offers 2% credits for water-leak detection systems as well as temperature monitoring systems that protect a home's pipes from freezing.

Disaster Preparedness

Credits are available for people who guard their homes against natural disaster. Storm shutters and shatter-proof glass can help reduce premiums in some areas, according to the Insurance Information Institute. At State Farm, a wind-resistant roof can result in a discount from 3% to 20%, Mr. Luedke says. At Chubb, an automatic seismic shut-off valve that protects gas lines in the event of an earthquake, as well as a back-up generator, can reduce an insurance bill.

Other Discounts

Live in a gated community? Chubb provides a 5% credit for that level of security. Many carriers will also offer breaks if the home's plumbing or electrical system has been completely modernized, according to the Insurance Information Institute.

Discounts for Repeat Customers

There's often a discount if at least one car is insured under the same carrier that insures your home, Mr. Luedke says. And the longer you've been a customer -- and haven't racked up any claims -- the better the price break. At State Farm, for example, a claim-free customer who has used the company for more than nine years is eligible for a 20% break on his or her premium.