Your Home Insurance Costs Could Go Up if You Make These Moves

The average cost of homeowners insurance is $2,304 per year. Many factors impact the cost of covering each home, though, so some property owners pay less and others pay much more.

Costs aren't set in stone for a policy either. In many cases, homeowners insurance premiums can increase even after coverage has been purchased. There are a few specific moves property owners could make that might result in premiums rising substantially.

1. Letting the home fall into disrepair

Homeowners insurance companies want to make sure that the property they are covering is in good condition and is as protected against the elements as possible. As a result, homeowners who fail to maintain their property could end up paying much higher premiums out of their checking account.

Say, for example, a homeowner opts not to fix their roof even as it gets old and starts to leak. Their standard insurer might drop them, forcing them to buy coverage from a high-risk insurer that could charge much more for less coverage.

Something similar happened to me. Many years ago, I bought a home that needed some remodeling and the insurer felt the roof was in poor condition even though it didn't leak. The company requested that we replace the roof, which we did not do, and it raised our premiums by 10% as a result because it said our house was riskier to cover.

2. Making a claim on the policy

Homeowners who actually make a claim on their insurance policy could also face higher premiums. Prices could go up around 9% to 20% per claim, depending on the insurer and the specifics of the claim that was made. That's because insurers have found people who make one claim are more likely to make others in the future.

3. Adding a swimming pool

A pool is also considered to be risky by an insurer since there's a greater chance of a liability claim if someone gets hurt. The insurer also has to cover the pool under other structures coverage, which means there's an added type of loss it would have to pay out.

Adding a pool could add about $50 to $75 to an annual premium on a home insurance policy. Homeowners need to be sure to take this ongoing added cost into account before deciding that putting in a pool is the right choice.

4. Adding an expensive new addition

Property owners need to make sure their policy limits are high enough to cover the replacement value of the property, even as it changes over time. Otherwise, there may not be enough money to rebuild.

Building an addition onto a home increases the cost of rebuilding it, so buying more home insurance coverage could become necessary. Getting higher coverage limits will typically send insurance premiums higher. The exact premium increase will depend on how much coverage limits have to be raised.

5. Getting a dog

Since homeowners insurers provide liability coverage and may have to pay out when a policyholder is sued, anything that increases the chance of a lawsuit will cause an insurer to raise rates. And having a dog can increase that chance since dogs can bite.

Certain breeds make insurers especially nervous, and getting one of them could lead to much higher insurance premiums or even having coverage dropped. These usually include breeds like pit bulls, German shepherds, and Rottweilers. Anyone who is bringing one of these animals home should check with their homeowners insurer to see just how much the added costs would be.

In some cases, paying a little more for homeowners insurance makes sense if doing so allows for lifestyle improvements (such as building a pool for someone who loves to swim or adding a dog to your family). But it's important to know that upfront, so higher insurance premiums don't lead to a financial scramble.