Homeowners Insurance: Affordability for All?

between the goal of achieving homeownership or continued renting. For these people insurance payments can quickly outpace their ability to keep up financially. This is particularly true thanks to new guidelines insurance companies are starting to use which base your insurance rate on factors that are outside normal loss conditions, such as credit score and income levels.

Insurance companies will argue that they do not discriminate against low-income families and those who are better off. However, statistics show that many low-income homeowners typically have lower credit scores than their wealthier counterparts. This can be for a number of factors, but increasingly it is because of unexpected medical bills and other critical services for which they have no control. By basing insurance rates off of credit scores insurance companies are using data that has no correlation on potential loss risk factor to fatten their bank accounts while making it more difficult for low-income families to afford homeowners insurance.

There are a few things that all homeowners can do to decrease the rates they pay for insurance. The first is to raise your deductible; going from a 0 to a 0 deductible could cut your premium by as much as 1/3rd in some instances. Another cost-saving tip is take advantage of as many discounts as possible with the insurance company. Often times the insurance companies won’t tell you about these, but rather you must ask directly about what