How to Save Money on Your Insurance Premiums Without Cutting the Coverage You Need

J.D. Power reported in 2024 that 36% of small businesses experienced insurance premium increases in the past 12 months, and the trend has continued. Texas homeowners have faced some of the sharpest increases in the country due to hail frequency, rising construction costs, and carrier pullbacks from the Texas market. The temptation when premiums rise is to either absorb the cost or cut coverage to reduce the premium. Both are usually the wrong response.

The right response is a structured review of how your coverage is built, priced, and positioned. There are legitimate ways to reduce premiums without meaningful coverage sacrifice, and there are premium-reduction tactics that look like savings but expose your business or home to unacceptable risk. This guide covers both - and how an independent broker like Thumann Insurance Agency can find savings you cannot find by going directly to a single carrier.

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Why Premiums Are Rising for Texas Businesses and Homeowners

Before addressing how to reduce premiums, it helps to understand why they have been rising. Premium increases come from a combination of factors, some of which you can influence and some of which you cannot.

• Increased claims frequency and severity: Texas leads the U.S. in hail claims, has elevated tornado and flood activity, and saw several catastrophic weather events in recent years. Higher claims paid by carriers translate directly into higher premiums across the market.

• Rising construction and materials costs: The cost to rebuild commercial and residential property has increased 30–40% since 2020. Carriers price property premiums based on replacement cost, so as replacement costs rise, so do premiums even with no change in your risk profile.

• Inflation in medical and legal costs: Liability claims involve medical expenses and legal fees, both of which have inflated significantly. Higher average claim costs mean higher liability premiums across all industries.

• Carrier underwriting changes: Some carriers have pulled back from certain Texas markets, reduced their appetite for specific property types (older roofs, coastal exposure), or narrowed the coverages they offer in high-risk areas. Fewer carriers competing for your business means less price pressure.

With that context, here are the strategies that actually work to reduce premiums without compromising your protection.

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1. Work With an Independent Broker to Shop the Full Market

This is the single highest-impact action for most policyholders. Carriers use proprietary algorithms to price risk, and those algorithms produce widely varying results for identical risk profiles. Business.com has noted that the price difference between the best and worst carrier quotes for the same coverage can be significant enough to represent meaningful savings on identical coverage terms. A captive agent or direct carrier can only show you one company’s pricing. An independent broker like Thumann Agency compares options across 80+ carriers to find the best available rate for your specific risk profile.

The savings opportunity is especially high at renewal. Many policyholders accept renewal rates without checking whether other carriers would price the same coverage more favorably. Annual shopping through an independent broker is the most reliable way to stay at the market’s best rate rather than drifting to the high end of the pricing range as your current carrier adjusts its appetite. Call (972) 991-9100 or contact us online to request a no-obligation market comparison.

2. Bundle Policies for Multi-Policy Discounts

Bundling multiple policies with a single carrier - or through a structured package like a Business Owner’s Policy (BOP) - is one of the most reliable premium reduction strategies available. A BOP combines general liability, commercial property insurance, and business interruption coverage into one package, typically at a lower combined price than purchasing three standalone policies.

For personal insurance, bundling home and auto insurance with the same carrier typically saves 5–20% on both policies. Business owners who also insure their personal lines through Thumann Agency can sometimes find bundle pricing that covers both commercial and personal policies more efficiently.

Important caveat: Bundling with one carrier is not always the lowest combined cost. An independent broker evaluates whether bundling or splitting policies across carriers produces the better combined price for your specific coverage needs.

3. Adjust Your Deductible Strategically

Your deductible is the amount you pay out of pocket before insurance coverage activates on a claim. Higher deductibles mean lower premiums, because you are absorbing a greater share of small and mid-size losses. This is a legitimate premium reduction strategy when calibrated correctly.

The right approach: Set your deductible at the highest level you could comfortably pay from reserves without financial stress if a claim occurred. For a business with $30,000 in readily accessible reserves, raising a deductible from $1,000 to $5,000 may reduce premiums meaningfully while leaving you financially able to handle a claim.

The wrong approach: Setting a deductible higher than your available reserves to minimize the premium, then being unable to cover the deductible when a claim occurs. This negates the value of the coverage you are paying for and can delay or complicate claims settlements.

Special consideration for Texas property policies: Many Texas commercial and homeowners policies include a separate wind and hail deductible expressed as a percentage of the insured value (commonly 1–2%) rather than a flat dollar amount. On a $500,000 commercial property, a 2% wind deductible is $10,000 - make sure this is an amount you can absorb before storm season.

4. Maintain a Clean Claims History

Your claims history is one of the most significant factors in how carriers price your policies. Businesses and homeowners with no claims in the past three to five years typically qualify for preferred pricing tiers at most carriers. Each claim - especially one large enough to affect your CLUE (Comprehensive Loss Underwriting Exchange) report - can increase your renewal premium 20–40% and, in some cases, result in non-renewal.

The practical implication: Not every covered loss is worth filing a claim for. If the damage is modest and close to your deductible, paying out of pocket and preserving your claims-free record may save you more over the next three to five years in premium savings than the claim payment you would receive. Discuss this calculation with your broker before filing any claim that involves modest losses.

5. Implement Risk Management Programs

Carriers price premiums based on the probability and severity of claims. Demonstrable risk management reduces that probability, and many carriers reward it with premium discounts or preferred underwriting treatment.

• Workplace safety programs: Documented safety training, OSHA compliance, safety manuals, and incident reporting procedures reduce workers’ comp and general liability claims. Some carriers offer explicit discounts for businesses with formal safety programs.

• Security systems and technology: Commercial properties and homes with monitored alarm systems, video surveillance, access control, and water leak sensors have lower property claims frequency. This translates to discounts from most property carriers.

• Cybersecurity practices: For businesses carrying cyber liability insurance, implementing multi-factor authentication, employee security training, and documented incident response plans can reduce cyber insurance premiums and improve carrier appetite.

• Driver monitoring for commercial auto: For businesses with commercial vehicles, telematics programs that monitor driving behavior can qualify fleets for lower commercial auto premiums at carriers that offer usage-based pricing.

• Impact-resistant roofing for property: Texas property owners who upgrade to Class 4 impact-resistant shingles can earn significant wind and hail premium discounts - sometimes 15–25% on that portion of their premium - from carriers that recognize this upgrade.

6. Review Your Coverage for Overpayment and Gaps Simultaneously

Most premium reviews focus only on cutting cost, but the most valuable review identifies both: areas where you are overpaying for coverage you do not need, and areas where you are underinsured and potentially facing unexpected out-of-pocket exposure.

• Check for duplicate coverage: Do you have coverage for equipment or vehicles you no longer own? Commercial property schedules sometimes include assets that have been sold or retired. Removing them reduces premium.

• Verify your revenue and payroll figures: Many commercial policies - particularly general liability and workers’ comp - are priced based on your reported revenue and payroll. If your revenue declined or your headcount decreased, your premium should reflect it. If you reported projections that did not materialize, you may be overpaying.

• Confirm your property values are current: Underinsuring your property to lower premiums is a serious risk. In Texas, construction costs have risen sharply. If your dwelling or commercial property coverage limit has not been updated, you may face a coinsurance penalty at claim time. Make sure your coverage reflects current replacement cost, not the value set three or four years ago.

• Audit your class codes: Workers’ comp and general liability policies are priced based on industry classification codes (class codes). If your business has been misclassified into a higher-risk code than your actual operations warrant, you are overpaying. An independent broker can review your classification and flag potential corrections.

7. Ask About Industry and Association Discounts

Many carriers offer preferred pricing programs for members of specific trade associations, professional organizations, or industry groups. If your business is a member of any trade association, chamber of commerce, or professional organization, ask your broker whether group pricing programs are available through any of their preferred carriers. These programs are not always advertised and are easy to miss without an agent who knows to ask.

8. Pay Annually If Cash Flow Allows

Most insurance carriers offer a discount - or avoid installment fees - for policyholders who pay their annual premium in a single payment rather than monthly. The savings are typically modest (3–7%), but represent immediate, guaranteed return on the cash deployed. If your cash reserves allow it, this is a low-effort premium reduction tactic.

9. Consider a Higher Commercial Umbrella Limit Instead of Higher Primary Limits

If your business needs to increase its total liability limits - for a contract requirement or because your exposure has grown - adding or increasing a commercial umbrella policy is almost always less expensive than raising the limits on your underlying primary policies individually. An umbrella policy typically costs $40–$75 per month for $1 million in additional coverage across all your underlying liability policies. Raising general liability limits alone to achieve the same effect typically costs more.

10. Schedule an Annual Policy Review

The most reliable way to stay at the best available rate is to review your entire insurance program annually, ideally 60–90 days before your renewal dates. An annual review gives your broker enough lead time to shop the market, update coverage for business or life changes, and present you with carrier alternatives before you are committed to another year with your current insurer.

Thumann Agency provides annual reviews for all commercial and personal insurance clients. If you have not reviewed your coverage in more than 12 months, contact us at (972) 991-9100 or request a coverage review online. We compare options across 80+ carriers to make sure your current insurer is still offering the market’s best rate.

What NOT to Do When Premiums Rise

A brief note on tactics that appear to save money but often create more expensive problems:

• Do not drop business interruption coverage to save money: Business interruption is frequently the first coverage cut by small business owners facing premium increases. It is also frequently the most financially critical coverage after a major loss. A business that survives a physical loss but cannot cover payroll and rent during reconstruction often fails anyway.

• Do not underinsure your property to lower the premium: Coverage limits below your property’s actual replacement cost can trigger coinsurance penalties at claim time, reducing your claim payment by a percentage equal to how much you are underinsured. The premium savings are rarely worth the claim-time penalty.

• Do not assume the lowest price is the best deal: The cheapest quote typically comes with the broadest exclusions or the weakest carrier financial rating. Price should be one factor in your evaluation, not the only factor.

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Get a Market Comparison on Your Current Insurance Costs

Thumann Insurance Agency serves Dallas, DFW, and Texas businesses and homeowners with independent insurance representation across 80+ carriers. If your premiums have increased at renewal, if you have never shopped your insurance against the full market, or if you just want to confirm you are positioned correctly, a coverage review costs you nothing. Call (972) 991-9100 or contact us online to schedule a review today.

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Frequently Asked Questions

How much can I realistically save by shopping my business insurance?

The potential savings vary significantly based on your industry, current carrier, risk profile, and how recently you last shopped. For businesses that have been with the same carrier for three or more years without shopping, savings of $500–2,000+ per year are commonly found through an independent broker market comparison. The savings potential is higher for businesses in industries or locations where carriers have shifted their underwriting appetite.

Does raising my deductible always lower my premium?

In most cases, yes. Higher deductibles result in lower premiums because you are accepting a greater share of small and mid-size losses. The practical limit is your available cash reserves - the deductible should never exceed what you could comfortably pay after a covered event.

Does my credit score affect my business insurance premium in Texas?

Yes. Texas insurers are permitted to use credit-based insurance scores in pricing both commercial and personal insurance policies. A strong credit history demonstrates financial responsibility and is associated with lower claims frequency, which typically translates to lower premiums. Maintaining good credit is a long-term premium management strategy that applies across both business and personal lines.

How often should I review my insurance coverage?

At minimum, once a year, ideally 60–90 days before your renewal date. Additionally, any time your business has a significant change - new employees, new locations, new equipment, new revenue levels, or new contracts with higher insurance requirements - your coverage should be reviewed to ensure it still matches your actual risk profile.