How Home Security Systems Reduce Your Insurance Premium

Can a Security System Lower Your Homeowner’s Insurance?

Yes. Most major homeowner’s insurance carriers offer premium discounts for homes with security systems, and the savings can partially or fully offset the cost of monitoring over time.

How Much Can You Save?

Discounts range from 5 to 20 percent of the homeowner’s insurance premium, depending on the insurer and the type of system. The average homeowner’s insurance premium in the US is approximately $1,500 to $2,000 per year a 10 percent discount saves $150 to $200 annually. At $30 per month for professional monitoring ($360/year), the insurance discount offsets 40 to 55 percent of the annual monitoring cost. For homeowners in higher-insurance markets (coastal areas, high-crime zip codes), the discount may be larger.

What Systems Qualify for the Discount?

Most insurers require a professionally monitored system for the maximum discount. Self-monitored (app-only) systems typically qualify for a smaller discount or no discount. Some insurers specifically require a UL-listed monitoring center. Smart locks, security cameras, and smoke/CO detectors may each qualify for incremental discounts. Contact your insurer before purchasing to confirm what system types and certifications qualify for their specific discount program. (For more on this, see DIY vs. Professional Home Security Systems.)

The Right Way to Claim the Discount

After installing a monitored security system, contact your insurer and provide: the monitoring company name, the monitoring plan type (what is covered burglary, fire, CO), and the monitoring certificate or contract. Most insurers apply the discount retroactively to the start of the policy period or the next renewal. Keep the monitoring certificate current some insurers verify the discount at renewal by requesting proof of active monitoring.

Working With a Contractor on This Project

Getting the right outcome on any home services project starts before the work begins. A few consistent practices make the difference between a smooth project and a frustrating one.

Get at least two or three quotes. A single quote gives you no basis for comparison. Two or three quotes reveal the market rate for the work, expose scope differences between bidders, and let you assess contractor communication quality before any commitment is made. The lowest bid is not automatically the best value if the scope is thin or the materials are underspecified.

Ask for licenses and insurance before work starts. Verify current general liability insurance and, for any work involving workers on your property, workers compensation coverage. Licensing requirements vary by state and trade; confirm the specific requirements in your jurisdiction. A licensed contractor who carries appropriate insurance protects both parties if something goes wrong during the project.

Get the scope in writing. A written proposal that specifies materials, labor scope, timeline, what is included (permits, cleanup, disposal), and warranty terms is the foundation of a professional engagement. Verbal agreements on any of these points invite misunderstanding. For any project over $500, written scope is non-negotiable.

Clarify the payment schedule upfront. A reasonable payment schedule ties major payments to project milestones: a deposit at signing, a payment at material delivery or project start, and a final payment at completion after a walkthrough confirms satisfaction. A contractor who requires full payment upfront before work begins is a red flag in any trade.

Making a Confident Decision

The information in this article is designed to help you ask better questions of the professionals you work with, evaluate their answers with more confidence, and understand the decisions involved in this type of home services project. It is not a substitute for professional assessment of your specific home. (For more on this, see Questions to Ask Before Buying a Home Security System.)

Every home is different. Roof slopes, local weather, tree exposure, soil conditions, and existing system condition all affect what the right solution is for your specific situation. The general principles here apply broadly, but a professional who assesses your home in person will give you guidance that accounts for the details that general articles cannot.

When you are ready to move forward, getting at least two or three quotes from licensed, insured, local contractors is the most important practical step. It lets you compare approaches, assess contractor quality, and confirm that the solution proposed matches your specific situation and budget.

Home Security System Cost at a Glance

Here is a quick reference for home security system costs by system type and installation method. All ranges below include equipment; installation cost and monthly monitoring are noted separately. (For more on this, see What Affects the Cost of a Home Security System?.)

Cost Factor	Typical Range	Notes
Basic DIY kit (self-installed)	$100 to $300 in equipment	Includes essential door and window sensors, a hub, a keypad, and basic motion detection. Self-monitoring with camera recording runs about $10 a month, and professional monitoring is optional at $14.99 to $39.99 per month with no long-term contract for most DIY platforms.
Professional system with installation	$99 to $1,000 upfront	equipment minimums of $269 to $369 plus a $99 installation fee, or $99 all-in on a promotional install. Cellular backup included. Monitoring is a separate recurring charge of $25 to $60 per month, typically on a 2 to 3-year contract, with an early termination fee of 75 percent of the monthly charges remaining on the term.
Comprehensive smart-home security system	$1,200 to $2,500 installed	in equipment and professional installation Includes cameras at every entry point, smart locks, video doorbell, glass break sensors, smoke and CO detectors, and full smart-home integration. Professional monitoring at $40 to $60 per month, billed separately.

Monthly monitoring costs are ongoing and add significantly to the total cost of ownership over a 3 to 5-year period. Compare total cost including monitoring when evaluating system options.