Risk assessment indicators play a huge role in the amount that you are quoted for a homeowners insurance policy, and ultimately, how much you end up paying. But this may leave you wondering what a risk assessment indicator is and how it plays into your home insurance costs. Here are a few answers to the questions you may have.
What is a Risk Assessment Indicator?
A risk assessment indicator is how much risk the insurance company has for something happening to your house. This can be based on where you live and your risk for hurricanes, floods, fires or other natural disasters. Or it could be based on the amount of crime in your neighborhood. It can even be based on your sex and marital status. After all, single women may be more likely to have their home broken into than men.
How Does My Risk Assessment Indicator Affect My Insurance Price?
The more indicators you have, the higher your insurance policy will be. If you live in an area that is prone to flooding and high crime, you will pay more than someone who isn’t at risk for flooding and lives in a low crime neighborhood. This is because it is less-likely the insurance company will have to pay out a claim.
Can I Lower My Risk Assessment Indicators?
There are things you can do to offset some of your indicators. For example, installing a home alarm may help to lower your insurance costs. Talk with your insurance representative to find out what you can do to offset your indicators.
If you live in the Burlington, NC area, and are interested in learning more about risk assessment indicators and how they are affecting your homeowners insurance, give Don Allred Insurance a ring. We can help you look at what may be driving your home insurance up and find ways to keep it affordable for you.