When faced with higher premiums and looking for savings, make sure you have the right coverage and comparison shop.

Rising rates for homeowners insurance mean that many folks are looking for ways to cut costs. Bundling auto and home insurance, looking for group discounts and avoiding small claims are solid ways to help keep premiums down. However, there are some things homeowners do in an attempt to get cheaper insurance that could turn out to be mistakes in the long run.

Mistake 1: Not being upfront with your insurer

When you apply for homeowners’ coverage, an insurer will ask about things that could pose additional risk. For example, they’ll want to know if you have a pool, trampoline or certain types of dog breeds. Homeowners who fail to disclose such things and have a claim involving the risky factor in question will find themselves facing an uninsured claim and a rescinded policy.

Mistake 2: Assuming rental operations are covered

If you rent out a room, an accessory building or even your entire home, the risk to an insurer increases. Policies vary by provider, but most homeowners insurance policies do not cover rentals. To get coverage when renting out your property be sure that you have landlord coverage.

Mistake 3: Renewing without comparison shopping

While some insurers offer loyalty discounts, many regularly hike rates for long-time customers—even those without claims. Instead of simply paying the bill, call your insurer to see if there’s a better rate, then be sure to comparison shop and to know which insurer has the best rates.

Mistake 4: Not informing insurer of improvements

There are two reasons to keep your insurer up-to-date on home improvements. First, things like a new roof, upgraded plumbing or a security system can mean discounts. Second, improvements—like an addition—can increase the value of your home and you may need more coverage than before.

Mistake 5: Not enough coverage to rebuild your home

Homeowners may find themselves underinsured if it’s been a long time since they reviewed their coverage or if they choose a policy with low coverage to keep premiums low. Adequate coverage means having enough insurance to cover the cost of rebuilding your home. In recent years, construction materials and labor have significantly increased. Review your policy each year to make sure your coverage has kept pace.

Did you know your Consumers member benefits include discounted home insurance? Discover how you can save with our partner Nulty Insurance.

Consumers helps thousands of members finance land, first and second homes, and home improvement projects each year. We’d love to help you with a mortgage or home equity line of credit; contact us online or call us at 800.991.2221.

*All loans subject to approval. Rates, terms, and conditions are subject to change and may vary based on credit worthiness, qualifications, and collateral conditions.