What are installment fees?

An installment fee is a small service charge that covers the cost of processing additional premium payments.

One hand holding a pen, pointing at paperwork, and another using a calculator.

An installment fee is the small charge per payment you make on your home insurance premium. The fee covers the service cost of processing the additional payments on a monthly, quarterly, or bi-annual basis. Almost every insurance company charges this fee unless you pay for your policy in full each year.

As a Kin member, you’ll notice you save a little more overall if you don’t pay for your policy in installments. That’s because there is a $3 charge per installment on our home insurance in Alabama, Arizona, Florida, Louisiana, South Carolina, and Texas.*

You will also see a fee of $3 per installment on your premium breakdown if you have mobile home insurance in Florida, Louisiana, or Texas. The same goes for our Florida condo insurance policies.

How paying for your policy in full saves you money

The tiny installment fee doesn’t seem like much at first glance, but it does add up a little. If you choose a 4-pay plan for your Florida home insurance, for example, that’s $21 extra in processing fees (you don’t get charged for the first installment).

The best way to avoid these fees? You can choose to pay for your annual premium in full. While breaking the premium up in installments may be easier to budget for in the short term, it’s important to note that it doesn’t save money in the long run. 

Why do insurance companies charge installment fees?

Insurers charge installment fees for two main reasons:

  1. It covers each additional credit card processing fee. Each time your insurance company runs your credit card, their servicer charges them for the transaction. Your installment fee offsets that charge.

  2. It ensures they can keep offering budget-friendly installment plans. If a company didn’t charge installment fees, it would be unfair to policyholders who pay in full. For example, if you chose a 4-pay plan and your company didn’t charge a fee to cover transaction costs, the insurer would be covering $21 they didn’t cover for one-time payers.

Other fees you may see in your premium breakdown

Some policies include other types of home insurance fees, and these vary from insurance company to insurance company and state to state. If you have any questions, please click on our chat option at the bottom of this page.



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