home insurance rates

Like this article? Find more great tips by subscribing to my blog here

Home insurance rates in Austin are determined by various rating factors. No two policies are exactly the same.  If you’re looking for homeowner insurance in Austin, TX,  you should be aware of the variables that determine your rates.

Variable #1 | Age of Home

One variable is the age of your home.  You wouldn’t expect to pay the same amount of money for insurance on a 20 year-old car that you rarely drive compared to a brand new car that you drive every day to work.  The same applies to homeowner insurance, but conversely.  With homeowner insurance, the cost of the insurance increases as your home ages.  This is because older homes have a higher incidence of claims, due to natural deterioration of the home.  As a home ages, pipes are more likely to break and toilets are more likely to overflow.  Since insurance companies pay out more money for claims on older homes, homeowner rates are generally higher.

Variable #2 | Age of Roof

In Texas, especially central Texas, most homeowner claims are filed for hail damage to roofs.   Since newer roofs offer more protection from hail and windstorm than older roofs with loose shingles and other deterioration issues, the age of the roof is a rating factor for homeowner insurance.  Also, the type of roof is another factor that determines rates.  For example, metal roofs withstand hail and wind better than composition roofs and have a longer lifespan.  Therefore, since metal roofs give better protection, homeowners with metal roofs usually get better insurance rates on their home.

Variable #3 | Fire Station and Town Class

Each fire station has a town class or rating, which is a countrywide classification system used by the Insurance Services Office (ISO) to reflect a community’s local fire protection for property insurance rating purposes.   According to the Texas Department of Insurance website, ISO classifies communities from 1 (the best) to 10 (the worst) based on how well they score on the ISO Fire Suppression Rating Schedule, which grades such features as water distribution, fire department equipment, manpower, and fire alarm facilities.  ISO field representatives use the schedule when surveying a community’s fire protection capability.

An Overlooked Factor | A History of Claims

The number of previous claims a homeowner has filed determines homeowner rates.  Claims history is a rating factor that determines homeowner and auto rates in Austin, Texas. Before filing a claim,  it’s a good idea to get an estimate for the damages to make sure the deductible will be met.  If the damage is less than the deductible, there is no point in filing a claim, as homeowners can lose claim-free discounts by filing claims, even if there is no money paid out by the insurance company.

An Additional Variable to Consider | Consumer Report

Finally, insurance companies use consumer reports to determine rates.   A consumer report reflects the credit and number of previous claims filed by a homeowner.  Although a consumer report does not tell insurance companies a homeowner’s actual credit score, a consumer report does indicate whether or not a homeowner has a history of paying his or her bills in a timely manner.  For privacy reasons, an insurance agent or company is required to ask permission to run a consumer report.  Running a consumer report does not affect a homeowner’s credit score, as it is only a soft hit, and does indicate that a homeowner is applying for additional credit.

Like this article? Click here to subscribe to my blog for the latest tips!

Cheri Roman
Cheri Roman
I’m a graduate of the University of Texas & have a master’s degree in Business Administration from Texas A&M University, Corpus Christi. As a former teacher, I believe in educating my clients about insurance and investment options, and partnering with them to protect their family and achieve their financial goals.

Leave a Reply

Your email address will not be published. Required fields are marked *