These 15 Home Improvements Deliver Big Insurance Discounts

When it comes to homeowners insurance, it’s easy to set it and forget it. After all, most consumers only think about insurance when they’re getting a filing a claim or scoring homeowner insurance discounts when it’s time for a new policy. But if you take that approach, you could be leaving money on the table.

Most companies offer homeowner insurance discounts on several home improvements and repairs. Some upgrades can knock as much as 35% off the premium. With the average cost of homeowners insurance at $1,445 per year, that’s a potential savings of more than $500. 

So if you’ve made some improvements to your home since getting your policy or you plan to make some changes soon, these upgrades could put some money back in your pocket.

Upgrades that increase your home’s security and safety, and decrease your risk can result in significant savings while others may garner a more modest decrease. For example, some insurers only provide a 1% discount for a centrally-monitored fire alarm. But other upgrades, such as overhauling an electrical system, can result in savings as high as 33%. Additionally, home insurance discounts vary between insurers, even for the same upgrade.

Upgrades that increase your home’s security and safety, and decrease your risk can result in significant savings

Of course, home improvements vary significantly in price, depending on the project. You’ll need to weigh the cost and total benefits of the upgrades you’re considering against their potential savings.

Before you begin, contact your homeowner insurance company

It’s a good idea to communicate with your insurance company or insurance agent before making any repairs or renovations as some upgrades could drive up your rate. For example, any home improvements that add to your square footage or increase your risk of loss will likely raise your premium.

A conversation with your insurance company will shed light on how your proposed upgrades will affect your policy. You’ll also be able to discuss strategies for offsetting any increases. For instance, you might consider increasing your deductible. Homeowners can save as much as 13% on their insurance premium by going from a $500 deductible to a $1,000 deductible.

15 home improvements that earn insurance discounts

To help you do that, we’ve gathered top 15 home improvement projects that can also reduce your insurance rate. Where available, we’ve provided the average cost per project and projected discount. Your actual savings will depend on the particular upgrade, your location and additional factors. 

1. Install smoke detectors

Average cost: $20-$30 per device

Since smoke detectors are required in most parts of the country, they won’t save you much on your insurance. But some insurers still provide discounts for this safety measure. Those that do typically offer between 2% to 5% off the premium. Keep in mind that there are several types of smoke detectors to choose from and each may provided more or less protection based on the type of fire.

2. Upgrade your roof

Average cost: $8,049 for a replacement

Repairing or replacing your roof is a big job. But it’s one that can provide significant savings. Some insurers offer discounts for a new or relatively new roof, while others give consumers a break for installing a specific type of roof or one using certain materials. Even if you don’t get a discount upfront, a well maintained roof is crucial — some companies won’t pay for damage from a roof leak if it was caused by neglect. 

3. Upgraded windows and siding

Average cost: $5,622 for new windows; $10,266 for new siding

Replacing windows and upgrading your exterior siding protects your home from storm damage and could result in a discount. Keep in mind that such upgrades could also trigger an increase in your premium if they raise your home’s replacement cost.

4. Fire sprinkler systems bring the biggest insurance discounts

Average cost: $592

Homeowners who install a sprinkler system can get as much as 15% to 20% off their premium, depending on the features. A system that also alerts emergency services will offer a greater discount.

5. Install deadbolt locks

Average cost: $40-$75 for installation plus cost of lock 

Again, anything that provides an extra layer of protection can result in savings. Some insurers will knock 5% off your premium for placing deadbolt locks on your doors. This is an inexpensive fix that can shave a little money off your policy premium. Smart deadbolt locks add even more convenience and protection.

6. Add a monitored alarm system

Average cost: $1,283 for a basic system 

Having an alarm system can go a long way towards warding off potential intruders. How much it will save you on your insurance depends heavily on the type of system and the insurer. Some companies offer up to 5% off for a stand-alone burglar alarm while others provide a more significant discount for a system monitored by a third party.

7. Fences that save lives and deliver discounts

Average cost: $2,800

Having a fence around your property can reduce your chances of theft or vandalism. And if you have a pool, fencing it in decreases the risk of accidents and can lower your insurance premium. Check with your provider on what discounts they offer.

8. Get rid of your pool for big insurance discounts 

Average cost: $6,255

Pools may be a lifestyle upgrade for some homeowners, but they’re a maintenance nightmare for others. And to insurance companies, they’re a significant risk. Removing an unused pool will lower your premiums. Or, if you’re keeping the pool, improve pool safety by reducing the safety hazard and your insurance rate by removing additional equipment, such as a slide or diving board, if present. 

9. Update electrical wiring 

Average cost: $1,323

Fires caused by old wiring or improperly installed wiring are all too common. An upgraded electrical system means your home is better protected against fires or other disasters. Insurance companies provide discounts on overhauled systems or electrical systems in new or remodeled homes. Discounts can range from 5% to 33% 

10. Add storm shutters

Average cost: $3,522

In areas prone to severe storms, storm shutters protect a home from flying projectiles. Your insurer may offer a discount for storm shutters or other storm-related precautions, especially if you live somewhere prone to bad weather. Discounts vary but expect to see significant savings if you live in an area prone to windstorms.

11. Install smart devices for the home to earn even more insurance discounts

Average cost: $260 for installation of a wireless doorbell (plus cost of device)

Installing smart home technology such as a video doorbell or accessories that communicate with your security system could trigger some savings through insurance discounts. But not all smart tech is created equal. Don’t expect to get a discount for a fridge that connects to your shopping list.

12. Install water shut-off devices

Average cost: $191 per device

Insurance companies typically offer discounts for water leak detection systems or automatic shutoff devices. Having these in place can reduce significant damage in the event of a burst pipe or flood. Depending on the system, you can save 3% or more on your premium. 

13. Install outdoor lighting

Average cost: $60-$450 including installation

Having well-lit outdoor areas in your home not only wards off potential burglars, but they also make your pathways and driveways safer. Check with your insurer to see if they provide a discount for motion sensor led lighting. 

14. Replace old plumbing pipes

Average cost: $1,077 to replace small sections of piping

Replacing your plumbing can protect you against mishaps, such as flooding from a burst pipe. Older homes typically have steel water pipes that rust and can cause major flooding if a pipe were to burst.

Some insurers provide homeowners insurance discounts up to 6% off your premium for updating your plumbing. If you have a new or remodeled home, your insurer may offer a larger reduction.

Install a whole home generator for insurance discounts

Average cost: $4,461

Some insurance companies offer between a 4% to 10% discount for installing an automatic generator. Having one in place reduces the likelihood of damage in the event of a power outage.

Average cost data was obtained from various sources, such as: CostHelper, Consumer Reports, HomeAdvisor, The Insurance Information Institute, Porch.com and ValuePenguin.