Can A Home Security System Save on Homeowners' Insurance?

Home security systems can help to lower home insurance quotes. They can also give peace of mind -- and there are many choices using new tech. The kind of security system and monitoring matters, however. Some systems don't offer enough protection to impact home insurance rates. With home insurance premiums averaging $1,200 and over in several Canadian regions according to J.D. Power Canada, investigating a home security system may offer a reduction in premiums along with a safer, more secure home.

What Kind of Home Security System Could Lower Home Insurance Premiums? 

Gone are the days of expensive, traditionally wired home security systems with security keypads that notified authorities of a break-in via a silent alarm. Homeowners have more choice in home security systems now than ever, from DIY wireless systems offering easy, quick setup to smart home technology that monitors your home's safety as it enables you to control lighting, temperature, and access at the touch of your fingertips.

Most insurance companies offer discounts for security systems that are monitored by a third party: typically, the company that installs and maintains the equipment. Third-party monitoring may also be called central monitoring, which refers to the centralized alarm center the system notifies in case of an alarm.

What is an Alarm Certificate and Do I Need One to Get a Discount? 

When you request home insurance quotes, you may see a line for "alarm certificate" or a statement that a "ULC Listed Monitoring Centre should monitor that your home security system." Your security system provider will offer a certificate that confirms they meet UL standards and are certified to provide 24/7 home security monitoring. "ULC" stands for Underwriters Laboratories of Canada. They are an international organization that sets safety standards in many different areas, from equipment like safety goggles to home security systems and monitoring.

Will New Smart Home Tech Affect Home Insurance Premiums? 

Discounts for traditional break-in or "burglar" alarms can range between 2 and 5 percent, according to Consumer Reports. A sophisticated monitored home security system could reduce home insurance quotes by 20 percent. The more sophisticated the system, the more problems it may prevent. Smart home systems can monitor for carbon monoxide, smoke, pipe leaks, and many other potential problems besides a break-in.

Will a Smart Home Security System Deter Burglars? 

Canada's rate of breaking and entering has been on the decline since 2000. Although overall crime rates in Canada increased in 2017, Stats Canada reported that breaking and entering continued to decline by 2 percent. Did increasingly sophisticated home security systems play a role? Possibly, as a panel of 12 London-based former burglars reported that smart home (not just alarm system) did act as a deterrent, along with barking dogs and clear evidence of monitoring cameras.

A home security system could reduce home insurance premiums, and the amount of discount will vary depending upon where you live and the type of system you have or plan to install. Compare home insurance quotes to find the best fit for your needs.