Does a Home Security System Lower Home Insurance?

Home insurance provides financial protection for homeowners against various risks to their property and assets. This coverage typically includes the physical structure of the home, known as dwelling coverage, and personal belongings within the home, referred to as personal property coverage. Additionally, it offers liability protection in case someone is injured on the property and covers additional living expenses if the home becomes uninhabitable due to a covered event. Home security systems serve as protective measures designed to safeguard a property and its occupants from potential hazards.

Impact on Home Insurance Premiums

Installing a home security system can often lead to a reduction in home insurance premiums. Insurers frequently offer discounts because these systems help mitigate the risk of claims related to theft, vandalism, and certain types of property damage. By deterring potential incidents, security systems decrease the likelihood of an insurer needing to make costly payouts. This reduction in risk translates into savings for the insurance company, which they can then pass on to policyholders in the form of a discount.

The specific discount amount can vary significantly, from 2% to 20% of the premium, depending on the insurer and the sophistication of the system. Factors influencing the discount include the system’s features, whether it is professionally monitored, and the homeowner’s claims history.

Types of Home Security Systems and Their Insurance Relevance

Different types of home security systems are viewed distinctly by insurance companies, impacting the potential for premium discounts. Unmonitored alarm systems, which primarily produce a local siren or alert the homeowner directly without involving a third party, typically offer the lowest or no discount. These systems do not provide the immediate professional response that insurers value in mitigating losses.

Professionally monitored systems qualify for the most substantial discounts, ranging from 10% to 20%. These systems connect directly to a central monitoring center that can dispatch emergency services like police or fire departments upon alarm activation, even when the homeowner is away. This immediate professional intervention significantly reduces potential damage and loss, making them highly attractive to insurers.

Smart home security devices, such as security cameras, smart locks, doorbell cameras, and water leak detectors, can also contribute to insurance discounts. These devices are more impactful when integrated into a larger system or when they prevent specific, high-cost perils like water damage or fire. Smart water sensors can detect leaks early, preventing thousands in repairs, and smart smoke or carbon monoxide detectors can trigger alerts and expedite emergency response. Deadbolt locks and reinforced doors are simpler security measures that can qualify for minor discounts, up to 10%, by improving basic home security.

Claiming Your Insurance Discount

To claim a home insurance discount for a security system, homeowners should first contact their insurance provider. Inquire about specific requirements and available discounts before installing a new system or upgrading an existing one. Insurers have varying criteria for what constitutes a qualifying security measure and the associated discount percentage.

Upon installation or activation of the security system, the homeowner will need to provide documentation to the insurer. This proof includes a purchase receipt, an installation certificate from the security company, and, for monitored systems, a “Certificate of Monitoring” or “Certificate of Alarm.” This certificate verifies that the system is professionally monitored, which is a prerequisite for the highest discounts.

Homeowners should review their specific policy terms to understand how the discount is applied and if there are any ongoing requirements, such as maintaining active monitoring service. Informing the insurer of any future upgrades or changes to the security system can help ensure continued eligibility for discounts.