When our mortgage nearly doubled due to the cost of our wind and hail insurance policy, I freaked out a bit. How was it possible that insurance could be so high?

When my heart started beating normally again, I called our insurance agent. My instructions to her were this:

Give me the lowest rate possible.

She went to work on it and called me a couple of days later with a quote that was 68% lower than what the mortgage company was charging us. As a matter of fact, when the new insurance rate was factored into our mortgage, our mortgage actually dropped an additional $20 lower than it was before the increase. Many people have asked how that was possible. All I can say is that there was a LOT of praying and trusting going on in this house.

How did we lower our insurance rate?

When I told our agent to get us the lowest possible rate, she did all of the work but this is how she did it.

1. She contacted our mortgage company to see exactly what was required. By doing this, she was able to adjust the value of our home slightly lower which decreased the cost of the insurance.
2. She raised the deductible to the highest available.
3. She priced the policy for structure only. Nothing inside the home is included in the wind and hail policy. Nothing outside the home is covered. Just the house.

While we were able to get a rock-bottom price on the insurance, there could be repercussions. If a hurricane blows the roof off our home and everything inside is wasted, none of it is covered. Nothing will be replaced. And, we will need to come up with a significant deductible. So, it is a risk, but these changes kept us from avoiding foreclosure.

My advice to you is this: Consider what you need in a policy. Don’t accept what the mortgage company gives you. Shop around.

What are your tips for saving on home owners insurance?

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