Reasons behind High Home Insurance Quote

We buy a home insurance policy to protect our home and its belongings in the event of theft, fire, natural calamity. Insurance companies evaluate risk in different ways, so it becomes important for the buyer to compare home insurance quotes to make sure he gets it at affordable rates.

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You should research different plans provided by the different home insurance companies. So, here are those certain other factors that make your home insurance quote high:

Renovation of House

Home insurers evaluate the premium of the house according to its present condition like amenities, size and in simple words, the overall design of the house. The factors as a buyer that you consider play an important role while purchasing the plan.

For example: Suppose you have bought a home insurance plan with a yearly premium of Rs. 30,000. In that year you made some changes in your house and installed few new things inside your house like a modular kitchen and a home theatre system, then in the next year premium of your home insurance policy will be evaluated after including the modular kitchen and a home theatre system hence increasing the premium rates of your home insurance policy.

Home Insurance Deductible

A deductible is a sum that you pay for risk before the insurer pays the claim. It depends on you that you choose the right deductible amount at the time of purchasing the policy. It is like the lower the deductible the less you save on premiums.

For example The premium amount of your existing policy is Rs. 30,000 and the deductible amount you agreed to pay is Rs. 5,000. The insurer will pay you Rs. 25,000 at the time of claim after cutting out the deductible amount.

Disaster Prone Areas

If your home is in a disaster-prone or a Natural calamity-prone area then it will increase the home insurance premium, while homes located in a low-risk area score lower premiums. It also depends if you live in a densely populated urban area.

For example: If you live in a house that is located in the mountains which is prone to land sliding then the house insurance premium will go high.

Inflation Increases

In India, inflation is touching new heights every other year. Similarly, the insurance companies increase their rates as inflation increases. It depends on the price range of home appliances the rates of insurance are adjusted. For measuring inflation, the insurance company gives the reference of the index of consumer price to adjust its rates. This makes it one of the biggest reasons behind the increment in the premiums of the insurance policy even if nothing has been changed or renovated.

Credit History

If you are an old home insurance policyholder then your credit score will impact the premium rates of the policy. The insurance company checks your credit score. Those people who have a bad credit history like check bounced have seemed like a financial risk by the insurance companies. Poor credit history can increase the premium of your home insurance plan.

Size, Age & Construction

The size of your home, age of your home and how was it constructed are also some of the factors that can impact your home insurance premiums. It is because if you live in a 30-year-old home that has a poor structure and when you decide to rebuild it. Then the premium of your home insurance policy will be evaluated on these things.

Prone to Crime Locality

If you live in an area that is prone to theft and burglary, then this will increase the premium of your home insurance policy. The insurance company evaluates the rate of crime in that area and how much they have paid for theft, burglary at the time of claim. The rate varies out based on your City, Colony or streets.


You make so much effort to build a home. It is important to secure it with home insurance. To buy the best home insurance policy, that gives you good coverage and comes in your budget with lesser premium rates always consider the above-mentioned points. To make the buying process easy, you can always buy your home insurance policy online and choose the right plan.

Written By: PolicyBazaar - Updated: 30 September 2021
Disclaimer: Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by an insurer.