New Jersey is home to roughly nine million people. Anyone who is renting or taking out a mortgage to buy a house should have homeowners insurance New Jersey. Buying homeowners insurance accomplishes three goals. A New Jersey homeowner will need homeowners insurance to protect the house and all the surrounding property, including the back and front yards. Renters need homeowners insurance as well because it allows them to protect their property in the event of a fire or other damage to their home. Buying homeowners insurance also protects the homeowner in the event they are sued because someone has entered their property and been injured in some way such as falling on black ice in the driveway during the state’s often harsh winters. When buying homeowners insurance, finding the best deal is important. Saving money on home insurance frees up finds for other important things in life like a week by the shore at the Wildwoods.
How Does Insurance Scoring Work?
Like many other states, New Jersey insurers rely on a practice known as insurance scoring. Insurance scoring is one of the methods that will influence the homeowners insurance rate you pay. Part of this measure is based on your credit score. All people have a credit score from one to 850. State law allows all New Jersey residents a free credit report each year from three credit agencies: Equifax, Experian, and TransUnion. Multiple factors will influence your credit score including your prior work history. New Jersey residents should expect to see their credit score and the rate they pay for home insurance to be influenced by issues such as the length of their credit history, the times they’ve made a late payment for something and issues with prior and existing debt of any kind.
Are Rates Consistent Throughout the State?Â
While insurance scoring will play a role in the price of any homeowners insurance a New Jersey resident can expect to pay, other factors will influence the cost of the policy. One company found the average price for a standard, approximately two thousand square foot house in New Jersey was about $988 per year. The same company found that the cost of the policy varied by hundreds of dollars depending on the location of the property with big cities such as Newark and Atlantic City being the most costly and smaller, more rural, in-land communities tending to have much cheaper rates. One way to immediately save money on homeowners insurance is to consider looking for apartments and houses only in an area where crime rates are lower than the surrounding areas. That house in Newark may seem less expensive initially, but you may have increased insurance costs.
Can You Buy a Bundled Policy?
Another way to find lower rates is to look for companies that will give you a discount if you buy home and auto insurance from the same company. New Jersey has the third highest auto insurance rate in the country at roughly $500 higher than the average American policy. Bundling both policies together can be an easy and painless way to save money on insurance and get a great deal. Bundling does not mean simply following a standard rate package. Most companies offer their clients a list of possible options and then let them choose which particular one is right for their specific home and auto needs.
What Is Your Unique Situation?
Home buyers and renters can often have insurance deals based on factors such as their status as first time home buyers or older residents.  A first time buyer may qualify for discounted home insurance rates. Ask your lender about special deals that may apply if you have never bought a home before. If you are renting for the first time and you are still attending college or graduate school, you may also qualify for a discount rate. Consult with your landlord about your specific circumstances. Seniors may also qualify for discounted home insurance rates. Joining the American Association of Retired People (AARP) can also help you find discounted home insurance rates in this state.
How Should You Take Flood Zones into Account?Â
The biggest natural disaster to hit New Jersey in the last fifty years was hurricane Sandy. Sandy struck many parts of the state including areas well in-land along the coast. If you are buying or renting a house, find out if the house is in a flood zone or was affected by the storm. If the property was not hit by Sandy or is not in a flood zone, you may not need to have options that will provide reimbursement in the event of a flood. Be aware that many insurance policies in New Jersey may not cover flood damage at all. Many areas of New Jersey are on higher ground. Look for a policy that will allow you to avoid being hit for home insurance costs you will never use.
Should You Increase Your Deductible?
Reducing your overall homeowners insurance rates can be as simple as keeping your deductible high. A higher deductible means the cost of your insurance policy will be lower. It also means you may need to pay out more out of pocket if your house is damaged. Consider installing a security system to further help lower your deductible and overall rate. New Jersey is one of 24 states that require you to have a both a carbon monoxide detector and smoke alarm. Make sure you have both in your house or your apartment or your provider may not give you compensation for certain damages.
2 Point Highlight
That house in Newark may seem less expensive initially but you may have increased insurance costs.
Bundling both policies together can be an easy and painless way to save money on insurance and get a great deal.
