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Does my Homeowner’s Insurance Decrease by Purchasing a Home Security System?

Does my Homeowner’s Insurance Decrease by Purchasing a Home Security System?

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Benefits of installing a Home Monitoring System

When you install a home security system for monitoring and safety purposes, it’s likely that you’ll face up to a 20 percent reduction in your homeowner’s insurance.

According to the statistics by the FBI, one house in the U.S. faces a burglary every 15 seconds and the ones that don’t have security systems are targeted up to three times more than the ones that do have them.  Insurance providers understand that the security system that is professionally monitored provides added protection to your residence and helps in creating a much safer living environment for your family.

The reason for the reduction in insurance is that insurance companies know the installation of home security systems can reduce your chances of experiencing a burglary and related complications and personal damages. These circumstances create a situation where it’s less likely that you’ll be in need of insurance. Hence, your provider saves that money and passes it to you.

This is why SafeWise advises homeowners everywhere to take advantage of what a security system has to offer. It’s no secret that it ensures your safety and peace of mind and with more affordable premiums; you can also save up to 20 percent of what you would pay the insurer.

Not many agencies will consider this, but burglaries and other attempts of damage can leave a devastating effect on your family. You can prevent your family from experiencing any kind of trauma by installing security systems. Stressful events can have a negative impact on a child’s development more than anything. This is why it is recommended that rather than having to handle a burglary, a monitored security system will ensure that it won’t happen at all.

Usually, the homeowner’s insurance is added to the mortgage plan that you’re paying. Since you don’t write a separate check for homeowner’s insurance each month, you don’t know how much it really costs and what amount you can save by installing a home security system that is monitored. Homeowners already face more expenses than they can count, which is why it is recommended that you drop any costs that can be saved. If you’re unsure about where to get started, this guide will help you in discovering and comparing rates of different home security so you can begin saving as soon as possible.

The Insurance Deduction With A Monitored Alarm

It’s important to learn what a monitored alarm system does before discussing the deduction. These alarm systems warn homeowners of an uninvited guest or any other potential dangers. They sound an alarm and send signals through the phone line to the station in charge of central monitoring. Staff at the center such as operators will contact the local fire and rescue department or any other task force that is seen as necessary.  Although there are still some arguments over how it’s safer whether the protection can be an investment, many insurance companies will offer reduced premiums to homeowners that have installed them.

Deductions By the Insurance Company

The State Farm Mutual Insurance Company quotes statistics by the FBI about how every 14.6 seconds, a burglary occurs in the U.S. These insurance providers also note that the average loss on each claim is about $3,921. Insurers seek to increase the number of home security systems installed nationwide. This is the reason behind their incentive of reducing premiums on homeowner’s insurance if the individual has installed a monitored alarm system and can go as high as 20 percent.

Audible Alarms Vs Central Monitoring

If you want to get the most reduction out of your insurance and get the lowest premiums, you have to ensure the alarm system in your home includes a central monitoring feature that allows it to be in contact with emergency services. Trespassing by an intruder will trigger the alarm in your home while the system sends signals to the security company’s central facility for monitoring purposes.

Usually, it’s the monitoring operators that will call you, but if they don’t respond the system notifies other policing services. An alarm system that alerts homeowners of an intruder, but doesn’t send a signal to the monitoring facility won’t win you much of a discount. An example is State Farm Mutual, which provides homeowners with a 15 percent discount on a central monitoring system that promptly notifies emergency services, but a system that notifies the homeowner of intrusions and not the police department will only earn a 7 percent discount.

Usually, other insurance providers don’t offer discounts to homeowners if they have installed an audible alarm system that doesn’t have central monitoring features.

Cost of Installation vs. The Deduction

According to an estimate by the Federal Reserve Board, homeowner’s insurance will cost somewhere around $300 to $1,000 every year. Assuming that with an average cost around $650, a discount of 10 percent on homeowner’s insurance with your monitoring security system can help you save $65 every year. On average, monitoring will cost you around $30 each month, which is more than what the discount on your insurance covers.

Benefit vs. The Cost

It’s not surprising to find out that spokespeople of the insurance industry have advocated these kinds of systems. It’s still rather uncertain as to the amount of protection these systems can provide and how effective they can prove to be in helping the police catch burglars.

It’s been observed that responses by the police are often delayed or slow, which makes it easier for burglars to adjust. They have adapted to the conditions rather well since they’re more able to get in and out much quicker than they did before.

This uncertainty makes the idea of installing home security systems look like an unnecessary expenditure. Nonetheless, although it may not seem like the most cost-effective solution and police response times are rather slow the yearly cost of $400 for a monitored alarm system can provide you with peace of mind.