Can I Get a Home Insurance Discount for a Security System?

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  • Can I Get a Home Insurance Discount for a Security System?

If you have a security or alarm system in your home, you may be eligible for a discount on your home insurance. The specifics of these discounts vary based on your insurer and the capabilities of your security system, but you may be able to save up to 15% off your premiums.

Let’s take a look at exactly how these discounts work, how you can cash in on savings from your insurer, the additional benefits a security system may provide, and how a home security insurance discount may vary by state.

Home Insurance Discount for a Security System Explained

If you’re thinking about installing a system for home security, savings could be on the horizon on your homeowners insurance policy. Many insurers across the country offer a home insurance discount for a security system that may range from 5% to 15% off your premiums if your security system meets your insurer’s standards.

According to recent data from the FBI, burglary accounts for about 16% of property crimes committed in the United States. Thus, many insurers reward homeowners who take extra precautions to protect their property with security systems.

While many insurers don’t advertise the exact amount of their home security system insurance discount because it can vary based on the system and other elements of your home, those with a self-monitored system can expect a lower discount than those with a highly integrated system. Generally, those with a self-monitored system, like a doorbell camera only the homeowner has access to, can expect, at maximum, a 5% discount.

Insurers like to know that you’re taking as much care as possible to protect your property, so they generally reserve the higher end of the discount spectrum for those who have a professionally monitored security system. So, when it comes to cameras and homeowners insurance, more bells and whistles mean more savings, possibly up to 15% off your premiums.

It’s crucial to note, too, that those with condo insurance, renters insurance, or even landlord insurance policies may qualify for a security system discount depending on their setup and insurer. Since burglars typically damage or target items that are covered under dwelling coverage, other structures coverage, or personal property coverage, all types of home insurance policies qualify for this discount, depending on the insurer.

How Much Does a Security System Save on Homeowners Insurance?

Home security savings vary based on the features of your security system and your insurer, but they typically save you about 5% to 15% on your homeowners insurance premiums. For example, the average home insurance premium in the country costs about $2,111 annually. So American homeowners can save, on average, anywhere from $106 to $317 on their annual premiums, reducing the average cost to about $2,005 to $1,794 annually. 

Since the average homeowners insurance premium ranges from state to state, we compiled a list of average premiums in each state based on HO3 policies with $300,000 in dwelling coverage and did the math to see how much the maximum discount amount of 15% could save homeowners in each state on their premiums.

Total Savings off Average Premiums By State
State Average Premium 15% Discount Premium After Discount
Alabama $2,237 $336 $1,901
Alaska $1,814 $272 $1,542
Arizona $2,730 $410 $2,320
Arkansas $2,642 $396 $2,245
California $1,373 $206 $1,167
Colorado $3,333 $500 $2,833
Connecticut $1,698 $255 $1,443
Delaware $1,032 $155 $877
Florida $3,925 $589 $3,336
Georgia $2,142 $321 $1,821
Hawaii $687 $103 $584
Idaho $1,790 $269 $1,521
Illinois $1,866 $280 $1,586
Indiana $2,101 $315 $1,786
Iowa $2,220 $333 $1,887
Kansas $3,874 $581 $3,293
Kentucky $2,783 $417 $2,366
Louisiana $3,607 $541 $3,066
Maine $1,313 $197 $1,116
Maryland $1,621 $243 $1,378
Massachusetts $1,395 $209 $1,186
Michigan $1,862 $279 $1,583
Minnesota $2,275 $341 $1,943
Mississippi $3,104 $466 $2,638
Missouri $2,744 $412 $2,332
Montana $2,639 $396 $2,243
Nebraska $3,552 $533 $1,348
Nevada $1,881 $282 $1,599
New Hampshire $2,568 $385 $2,183
New Jersey $1,109 $166 $943
New Mexico $1,516 $227 $1,289
New York $1,927 $289 $1,289
North Carolina $1,852 $278 $1,574
North Dakota $1,979 $297 $1,682
Ohio $1,495 $224 $1,271
Oklahoma $5,002 $750 $4,252
Oregon $1,221 $183 $1,038
Pennsylvania $1,393 $209 $1,184
Rhode Island $1,821 $273 $1,548
South Carolina $2,235 $335 $1,900
South Dakota $2,274 $341 $1,933
Tennessee $2,490 $374 $2,116
Texas $3,736 $560 $3,176
Utah $1,255 $188 $1,067
Vermont $1,276 $191 $1,085
Virginia $1,265 $190 $1,075
Washington $1,337 $201 $1,136
Washington, D.C. $1,303 $195 $1,108
West Virginia $1,341 $201 $1,140
Wisconsin $1,452 $218 $1,234
Wyoming $1,588 $238 $1,350
National Average  $2,111 $317 $1,794

While homeowners in Hawaii may only save about $100 on their premiums, they’re lucky to have the lowest average premiums in the country, so they’re already paying objectively low rates. 

Florida homeowners, however, could see as much as $589 deducted from their premiums with a security system discount. With Floridians paying as much as 46% above the national average on their premiums, any savings would come as a significant relief to these homeowners. 

Self-Monitored vs. Professionally Monitored Security Systems

Generally, security systems are divided into two categories that correlate with the percentage of savings you may receive for installing one in your home: self-monitored and professionally monitored.

Discounts vary based on how closely monitored your security system is, so if you have a round-the-clock monitoring service, you may see a larger discount on your policy than those with a self-monitored doorbell camera. In fact, some insurers even partner with the top brands in the home security industry to offer policyholders exclusive deals on installation, devices, and monitoring services. 

Self-monitored systems are generally the most basic and cost-effective options on the market. They may also be referred to as local alarm systems. These systems require you, the homeowner, to monitor them and take appropriate action when necessary. They’ll alert the homeowner or those near the home when alarms are triggered by sending a mobile alert or sounding a loud alarm. Generally, the discount for a self-monitored system won’t exceed 5% off your insurance premiums

Professionally monitored systems are the more sophisticated security systems on the market. They may also be referred to as central alarm systems. These systems offer the homeowner 24/7 monitoring from a security company at a monthly fee that will alert the homeowner and appropriate authorities when alarms are triggered. 

Self-Monitored vs. Professionally Monitored Security Systems
Security System Discount Range Installation Cost Monthly Cost
Self-Monitored 0% to 5% Free Free
Professionally-Monitored 5% to 15% $99+ $10+

While many of the devices offered by professionally monitored security systems are the same as those homeowners can monitor themselves, like a doorbell camera or a fire alarm, with a professionally monitored system, the security company constantly watches and records the footage. Central alarm systems generally must be installed by a professional and can’t be installed by the homeowner. 

As with all home insurance discounts, it’s crucial to chat directly with your insurer or agent about their home security discount, if they have one, and its qualifications.

When looking at home security systems, each company is a bit different, offering its unique set of perks to consumers. Below, we’ve compiled a list of some of the most popular companies that lead the home security industry that are most likely to get you a home insurance discount for security cameras, and outline how much you would need to spend to start saving on your homeowners insurance.

Security System Costs by Company
Company Device Bundle Cost Pro Install Cost Monthly Costs
Vivint $599 to $1,789 $99 $29.99 to $49.99
ADT $209.97 to $384.94 $150 $24.99 to $34.99
Frontpoint $79 to $419 Self Install Only $49.99
Simplisafe $149.98 to $425.94 $125 $10 to $30
Ring $179.99 to $599.99 $159.99 to $229.99 $20

While home security systems can get pretty advanced and costly, you could get the cheapest system from Frontpoint by spending only $79 upfront for your devices and $49.99 per month. Since Frontpoint doesn’t offer professional installation, you could already save about $100 on installation costs alone. 

The security system you decide to install is subjective and will depend on your needs as a homeowner and a policyholder, including your insurer’s requirements for a security system discount. If you’re looking to save as much money as possible, both on your security system and your home insurance policy, you’ll want to meet your insurer’s bare minimum requirements for the discount. 

However, if your safety is your main concern and your savings are just the cherry on top, you’ll want to do your own comparative analysis of the systems on the market and select the best option for your needs. 

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4 Different Home Insurance Discounts for Security Systems

If your security system offers monitoring for safety concerns other than theft or burglary, like fires, water leaks, or HVAC issues, you may receive even more significant home security savings, especially if these are also professionally monitored. For example, a fire alarm insurance discount alone may offer as much as 5% off your premiums, depending on how the alarm is monitored. 

Additionally, if you live in a gated community or a homeowners association, your insurer may offer you a special discount for living in a secure area, regardless of what type of security system you have or if you have one at all.

Let’s check out the lesser-known capabilities of a security system and how, when combined, they can help keep your property secure and increase your chances of getting a sizable chunk of your premiums deducted. 

1. Video Surveillance

By now, you’re probably a pro at answering the question “do security cameras lower insurance?”, and you may be wondering why insurers award savings to those with surveillance or security systems. 

Insurance discounts for video surveillance are likely to be the most significant because they provide protection for events like theft or burglary that can cause significant financial damage, both to you as the homeowner and your insurer should you file a claim. Homeowners who have video surveillance as a component of their security system are more likely to receive that coveted 15% discount.

2. Burglar Alarms

Insurance-approved burglar alarms, whether combined with a security system or used alone as a security measure for your home, could make you a shoo-in for some savings. There are both self- and professionally monitored burglar alarms on the market, typically in the form of window and door sensors that sound a loud alarm when triggered or contact your security monitoring company.

3. Smoke Detectors/Fire Alarms

According to the U.S. Fire Administration, in 2021 alone, residential fires caused about $8.8 billion in dollar losses. So, if you have a smoke detector, fire alarm, or sprinkler system, insurers may reward you with a discount for taking protective measures against financial losses on your property due to fire damage. 

If these features are integrated into your security system, especially if it’s professionally monitored, your insurer may increase your security system discount to reflect all the safety measures you’ve taken to protect your home against unexpected perils. However, by itself, a fire alarm discount on homeowners insurance may save you anywhere from 2% to 5% on your premiums.

4. HVAC/Water Leak Sensors 

Some security systems may offer HVAC or water leak monitoring, helping you ensure your home is always functioning in tip-top shape and alerting you when it isn’t. Water damage specifically accounted for about 23.5% of property damage claims filed in 2021, according to the Insurance Information Institute (III), so insurers reward policyholders who take measures to mitigate potential water leaks or damage

Similarly, some systems will also alert you if your HVAC system is functioning improperly, which can help mitigate claims. Thus, insurers may reward you with a more significant discount for your security system if such sensors are integrated. 

Depending on your insurer, having a security system that does more than monitor your property for theft can increase your chances of getting a more significant discount. Plus, security systems with more bells and whistles can help ensure that if something goes wrong on your property, you’ll know right away.

Why Would a Security System Lower Home Insurance?

Since theft is a covered peril on home insurance, insurers show their gratitude for homeowners who help mitigate theft claims by rewarding them with a discount.

Insurers offer more significant discounts for those with complex security systems because, in the event of a burglary, having access to a recording of the event can help streamline the claims process, making it easier on you and your insurer. 

According to a study conducted at the University of North Carolina in Charlotte that sought to understand convicted burglars’ decision-making processes, over 60% of burglars indicated that the presence of an alarm or camera on a property would cause them to seek an alternative target.

So, whether you install home security to save on insurance or the savings are just an added bonus to your peace of mind, make sure to check with your insurer about what security systems qualify for a discount and how much the discount may deduct from your premiums.

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The editorial content on Clovered’s website is meant to be informational material and should not be considered legal advice.

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