How to Lower Your Homeowners Insurance Rates in 2026

Homeowners insurance has increased 46% since 2021 — roughly three times the rate of general inflation. The national average premium is projected to hit $3,057 by the end of 2026, according to Insurify’s 2026 Home Insurance Report. In high-risk states, it’s far worse: Florida’s average is approaching $8,500 annually. California faces a projected 16% increase this year following the LA wildfires.

If you’re new to how homeowners insurance works, our homeowners insurance 101 guide covers the basics before diving into cost reduction. The frustrating part is that most homeowners accept their renewal rate without question. That’s expensive passivity. There are concrete, tested strategies that consistently lower homeowners insurance premiums — some producing savings within weeks. Here’s every one of them.

Table of Contents

• Why Rates Keep Rising
• 1. Shop Your Policy Every Year
• 2. Bundle Home and Auto Insurance
• 3. Raise Your Deductible
• 4. Install a Security System
• 5. Make Qualifying Home Improvements
• 6. Improve Your Credit Score
• 7. Protect Your Claims History
• 8. Right-Size Your Coverage
• 9. Ask About Every Available Discount
• 10. Pay Annually and Go Paperless
• Frequently Asked Questions

Why Rates Keep Rising — And Why That Makes Shopping More Important

Understanding what’s driving rate increases tells you where you have leverage. Three forces are pushing premiums up:

Climate risk. Severe weather events — wildfires, hail, hurricanes, flooding — have generated record insured losses in recent years. Insurers price future risk based on past losses, and those loss estimates are rising. Homeowners in the Midwest, California, and coastal regions are absorbing the sharpest increases.

Construction cost inflation. When a home needs to be rebuilt after a fire or storm, it costs significantly more than it did five years ago. Materials, labor, and supply chain factors have all pushed rebuilding costs higher — and insurers have raised coverage limits (and premiums) to match.

Reinsurance costs. Insurance companies buy their own insurance (called reinsurance) to protect against catastrophic loss years. Reinsurance pricing surged in 2023 and 2024, and those costs are passed directly to policyholders.

Here’s the silver lining: Matic’s 2026 mid-year report shows the rate of increase is finally slowing. Average renewal increases dropped to 10.6% in H1 2026 from 19.4% in 2025. And 11.7% of renewing homeowners actually saw their premium decrease — the highest rate since Matic began tracking the data. The market is starting to stabilize, which means shopping around right now is more likely to produce real savings than it was two years ago.

1. Shop Your Policy Every Year

This single action delivers more savings than anything else on this list. Homeowners insurance carriers price risk using proprietary algorithms, and those algorithms produce dramatically different premiums for the same home and coverage. Shopping around annually can save $300–$800 or more per year, according to multiple industry analyses — without changing a single line of coverage.

Most homeowners renew on autopilot. Their carrier raises rates 10–15%, they notice it, they shake their head, and they pay it. The carrier is counting on exactly that behavior. Breaking the cycle takes about 30 minutes once a year.

How to shop effectively:

• Get at least three quotes. Your current insurer, one national carrier, and one regional or online insurer. Regional insurers often offer better pricing in specific states than the national brands.
• Compare identical coverage. Make sure each quote uses the same dwelling limit, deductible, liability limit, and endorsements. A cheaper quote that slashes your dwelling coverage isn’t a win.
• Check AM Best ratings. Only consider carriers with an AM Best financial strength rating of A or better. A cheap policy from an insurer that won’t pay claims isn’t worth anything.
• Call your current carrier last. Once you have competing quotes, call your carrier and ask them to match. They often will — or they’ll offer a discount to retain your business. You only find out by asking.

Get quotes at our home insurance quotes page to start comparing options in your area.

2. Bundle Home and Auto Insurance

Bundling your homeowners and auto insurance with a single carrier is one of the most reliable discounts in the industry. Most major insurers offer a multi-policy discount of 10–25% on your homeowners premium when you bundle. Some extend the discount to additional policies — life insurance, umbrella coverage, boat, or RV.

The math is worth running explicitly. Your current homeowners carrier may not be competitive on auto, and vice versa. The bundle discount can be significant enough to make a slightly more expensive individual policy worth it when purchased together — but not always. Get bundled quotes and separate quotes from each carrier and compare the total.

If you’re bundling to save on homeowners insurance, your current auto insurer is a logical first call. Many carriers offer their best homeowners pricing to existing auto customers.

3. Raise Your Deductible

Your deductible is the amount you pay out of pocket before your insurer covers a claim. Choosing a higher deductible shifts more short-term risk to you — and insurers reward that shift with lower premiums. The Insurance Information Institute estimates that raising your deductible from $1,000 to $2,500 can reduce your annual premium by 10–20%, depending on your insurer and location.

On a $3,000 annual premium, that’s $300–$600 in annual savings. Over five years without a claim: $1,500–$3,000 saved in premiums, with the downside risk being one claim where you pay $1,500 more out of pocket than you would have.

The right deductible is the highest amount you could genuinely pay in an emergency without financial strain. The strategy that works best: set aside the deductible amount in a high-yield savings account earning 4%+ APY. You capture the premium savings, earn interest on the reserve, and are fully covered if you need to file a claim.

One critical nuance: many policies in hurricane, hail, and wind-prone areas now use percentage-based deductibles for those specific perils — often 1–5% of your home’s insured value. On a $400,000 home, a 2% wind deductible means $8,000 out of pocket for a wind damage claim, regardless of your standard deductible. Review your policy carefully for these separate deductible structures. Our homeowners insurance deductible guide walks through how to navigate them.

4. Install a Security System

Most major carriers offer premium discounts of 5–20% for homes with qualifying security systems. A professionally monitored system with cameras, door and window sensors, and environmental sensors (smoke, CO, water leak) typically earns the highest discount tier.

The discount size depends on your insurer and your system’s features:

• Basic local alarm (no monitoring): 2–5% discount
• Self-monitored smart system: 5–10% discount
• Professionally monitored system: 10–15% discount
• Comprehensive monitored system with environmental sensors: 15–20% discount

On a $3,000 annual premium, a 15% security discount saves $450/year — enough to cover the cost of a basic monitoring plan entirely, with money left over. Contact your insurer before purchasing a system to confirm which systems and monitoring types qualify for the discount, and request the documentation requirements in writing.

Our home security system comparison guide covers the top-rated options at different price points, including systems that consistently qualify for insurer discounts.

5. Make Qualifying Home Improvements

Certain upgrades reduce your home’s risk profile in ways that translate directly to premium reductions:

New roof. Your roof is the most scrutinized component in a homeowners insurance evaluation. A newer roof — particularly one with impact-resistant shingles rated Class 3 or Class 4 — can qualify for significant discounts. In many states, a new impact-resistant roof earns a 20–30% discount on the wind/hail portion of your premium. Some insurers require an inspection or updated roof documentation before applying the discount.

Updated electrical. Knob-and-tube wiring and certain panel brands (Federal Pacific, Zinsco) are considered fire hazards. Some carriers won’t insure homes with these systems; others charge significantly higher premiums. Upgrading to modern wiring and a 200-amp panel reduces risk and often opens access to better carrier pricing.

Updated plumbing. Replacing galvanized or polybutylene pipes reduces water damage claim risk — the most common type of homeowners claim. Some insurers offer discounts for homes with copper or PEX plumbing.

Storm-resistant upgrades. In hurricane-prone areas, storm shutters, hurricane straps, impact-resistant windows, and roof-to-wall clips can earn meaningful discounts. Florida and other Gulf states often have formalized rating systems (like the IBHS FORTIFIED designation) that insurers recognize with measurable premium reductions.

If you’re funding improvements through your home’s equity, our guide to using home equity for home improvements covers financing options that keep your existing mortgage rate intact.

6. Improve Your Credit Score

In most U.S. states, insurers use a credit-based insurance score as a significant factor in premium calculation. A low credit score can raise your homeowners insurance cost by hundreds of dollars annually — and improving your score is one of the highest-ROI financial moves available to homeowners who are underscoring.

The Consumer Federation of America found homeowners with poor credit were charged nearly $2,000 more per year on average compared to those with excellent credit — for the same home and identical coverage. That’s the cost of a credit problem that many homeowners don’t even know is affecting their insurance.

The fastest-moving levers for credit improvement:

• Pay down credit card balances to below 30% utilization (below 10% is better)
• Make every minimum payment on time — payment history is the largest scoring factor
• Dispute errors on your credit reports at AnnualCreditReport.com
• Avoid opening new credit accounts in the months before your policy renews

Note: Alaska, California, Hawaii, Maryland, Massachusetts, Michigan, and Oregon limit or prohibit the use of credit scores in insurance rating. If you live in one of these states, this strategy doesn’t apply to your insurance premium — though it still affects your mortgage rate and other borrowing costs.

7. Protect Your Claims History

Filing multiple insurance claims raises your premium and, in extreme cases, can trigger non-renewal. Insurers track claims through the CLUE (Comprehensive Loss Underwriting Exchange) database, which records claims filed in the past seven years. Even a single claim can result in a 10–15% rate increase at renewal.

The question to ask before filing any claim: does the payout justify the long-term premium impact? If repair costs are close to or below your deductible, there’s no financial benefit to filing. For costs modestly above your deductible, run the math on both sides.

Example: You have a $1,500 deductible and $2,800 in water damage. Filing gets you $1,300 from your insurer. But if your premium increases $200/year for five years, you’ve paid $1,000 in extra premiums to collect $1,300 — a net gain of only $300 over five years. Paying the $2,800 yourself might cost less in the long run, particularly if you have additional claims in your history.

The general guidance: reserve insurance for what it’s designed for — catastrophic or large-dollar events you genuinely couldn’t fund out of pocket. Keep a dedicated repair reserve for the smaller stuff.

8. Right-Size Your Coverage

Paying for more coverage than you need wastes money. Paying for less than you need creates catastrophic financial risk after a major claim. An annual coverage review finds the balance.

Insure to rebuild cost, not market value. Your dwelling coverage should reflect the cost to rebuild your home from scratch — not its sale price, which includes land. Many homeowners are significantly over-insured because their coverage was set based on market value years ago. Your insurer can help estimate current rebuilding costs, and you can request an updated estimate from a local contractor.

Audit your personal property coverage. Most policies set personal property coverage at 50–70% of your dwelling limit. If your actual belongings are worth significantly less than that, you may be able to reduce coverage (and premiums) without meaningful risk. Do a rough home inventory to estimate replacement values.

Remove endorsements you no longer need. Jewelry riders, scheduled personal property endorsements, and other add-ons should reflect what you actually still own. A jewelry rider for a ring you no longer have is money wasted.

Don’t skimp on liability. Standard policies include $100,000 in liability coverage — too low for most homeowners with meaningful assets. Increasing to $300,000–$500,000 typically costs very little (often $20–$30/year more) and provides substantial protection. Umbrella policies add another $1–$5 million of coverage for $150–$300/year.

9. Ask About Every Available Discount

Many discounts go unclaimed simply because policyholders never ask. When you speak with your agent or insurer, specifically request a complete list of available discounts and confirm which ones you currently qualify for. Common discounts many homeowners miss:

• New homebuyer discount: Some carriers offer discounts for first-time buyers or homeowners within the first year of purchase.
• Newly constructed home discount: Homes built within the last 10–15 years often qualify for favorable pricing.
• Claims-free discount: 3–5 years without a claim often triggers a loyalty-and-safety discount.
• Autopay discount: Setting up automatic payments typically saves 2–5%.
• Paperless billing discount: Switching to electronic statements often earns a small discount.
• Annual payment discount: Paying your full annual premium upfront (rather than monthly) eliminates installment fees and often earns a discount.
• Retiree or senior discount: Some carriers (particularly AARP-affiliated) offer discounts for retired homeowners, who are statistically home more often and file fewer claims.
• Military or veteran discount: Available through USAA and several major carriers.
• Professional or alumni discounts: Some carriers extend group discounts to members of professional associations, unions, or alumni organizations.

Note that most insurers cap total stacked discounts at 40–50% of the base premium. Ask how your discounts interact — some stack fully, others are capped.

10. Pay Annually and Go Paperless

These are the lowest-effort savings on the list but worth noting. Most insurers charge installment fees of $3–$10 per month for monthly billing — $36–$120 per year in fees that produce no benefit. Paying annually eliminates these and often triggers an additional discount of 2–5%.

Paperless billing discounts typically add another 1–3% on top. Together, these two changes might save $75–$200 per year with a five-minute account setting change. Not transformative, but real money for five minutes of effort.

Frequently Asked Questions