The National Association of Insurance Commissioners (NAIC) study from 2021 states that the typical cost of homeowners insurance is $1,249 per year, or $104.08 per month.
Your quoted price for homeowners insurance will depends on elements including location, house value, policy options, and discounts. We at the Home Media reviews team will go through these elements in this review and assist you in locating the best home insurance coverage for your property.
We used the NAIC’s January 2021 home insurance report to determine the cost of homeowner’s insurance for this article.
Average Home Insurance Cost by Coverage Amount
The 2021 NAIC report’s most recent data shows that the average annual cost of home insurance in the country was $1,249 in 2018. However, sorting the premiums by the amount of dwelling coverage you choose can give you a more realistic idea of what you might pay. A premium is the cost of maintaining your policy, while dwelling coverage pays you for any covered damage to your home’s structure.
|Amount of Dwelling Coverage||Average Monthly Premium|
|$49,999 and under||$645|
|$500,000 and over||$2,148|
Average Home Insurance Cost by Location
The place where you live also affects the cost of insurance. For instance, due to the increased risk of property damage, states with a higher incidence of severe weather, hurricanes, and tornadoes will typically have higher rates. The NAIC figures for the typical premiums in each state are shown below.
While places like Oregon, Utah, and Nevada have lower insurance costs since storms, flooding, and tornadoes don’t pose a threat there, Texas, Florida, Oklahoma, and Louisiana have some of the highest premiums in the country.
Most Expensive States for Home Insurance
- Texas: $1,955 per year
- Florida: $1,960 per year
- Oklahoma: $1,944 per year
Least Expensive States for Home Insurance
- Oregon: $706 per year
- Utah: $730 per year
- Nevada: $776 per year
What’s Included in a Home Insurance Rate?
Home insurance coverage is divided into six categories. Here’s an overview of each type of coverage:
1. Dwelling coverage – The structure of your home, its foundation, its interior and exterior walls, and other items built inside the home are all protected by this form of coverage (coverage A).
2. Other structures coverage – Other structures coverage, also referred to as coverage B, offers protection for buildings that are not attached to your house, such as fences and sheds. Typically, this coverage makes up 10% of your home insurance.
3. Personal property coverage — Your personal goods are covered under personal property coverage (coverage C), both inside and outside of your house.
Coverage C will pay to repair or replace your possessions if you experience a covered risk that damages or destroys them. Typically, this coverage makes up 50% of your home coverage.
4. Loss of use/additional living expenses coverage — If you must temporarily leave your home, this coverage (coverage D) will reimburse your expenses. It can be used to cover living costs such as rent, food, lodging, and laundry.
5. Liability coverage — If a visitor is hurt while visiting your home, liability coverage (coverage E) will cover the associated costs.
Additionally, it pays for the replacement of any items that guests bring into your home and damage.
6. Medical payments to others coverage — If someone is hurt in your home without your fault, this coverage (coverage F) pays for their medical expenses.
What are the Different Types of Home Insurance Coverage?
1. Actual cash value – The least expensive and lowest degree of security is this one. When you have an actual cash value coverage, your insurer will compensate you for the market value of your possessions and/or residence, less depreciation. The expense of replacing what you’ve lost will frequently exceed the amount for which you are compensated.
2. Replacement cost – Because depreciation is not taken into account, this medium level of protection will have a greater premium than a policy that pays actual cash value. The price of rebuilding your house or replacing your belongings without depreciation will be covered by this.
3. Guaranteed replacement cost – It costs more than the other two insurance since it offers the highest level of protection. Construction costs will frequently be higher than typical in the event of a covered disaster, like a hurricane or tornado. Even if the cost is greater than the insurance limits, this level of protection will rebuild and replace your belongings. In exchange for a greater price, several home insurance providers also provide increased limits, enabling homeowners to acquire extra coverage.
What Factors May Affect The Home Insurance Costs?
1. Location – As was already said, your house insurance premium will depend on where you live. Your insurance premium will be greater if you reside in a state that experiences more natural catastrophes.
2. Credit history – Homeowners with good credit will enjoy a lower insurance rate.
3. Price of your home – A more expensive home will cost more to rebuild, resulting in a higher quoted rate.
4. Level of coverage – Even if your policy limits are exceeded, your valuables will be replaced if you choose guaranteed replacement cost coverage, but the monthly premium will be greater.
How to Save Money on a Home Insurance Policy?
1. Check your deductible – You can select your deductible in the majority of homeowner insurance policies. Deductibles that are frequently used are $500, $1,000, $2,500, or a small portion of your housing coverage You can decrease your monthly rate if you can afford a higher deductible.
2. Maintain a good credit score – The cost of your house insurance policy is determined by insurers based on your credit score and credit history. By keeping your credit balances low and paying your obligations on time, you may maintain your credit.
3. Shop around – We advise collecting estimates from various companies to compare costs if you’re planning to buy home insurance or currently have it but want to lower your premiums.
How Can You Get Home Insurance Discounts?
Most providers provide a number of discounts, including those for bundling insurance plans and establishing autopay. Here are a few typical discounts provided by homeowners insurance providers:
1. Home safety devices – Your monthly premium will frequently be reduced if your home has any defences against fire, theft, or wind damage. Extinguishers, wind-resistant roofing, interior sprinkler systems, fire alarms, burglar alarms, professional monitoring devices, security cameras, and deadbolt locks are a few examples, but there are many more.
2. Multi-policy bundling – Auto insurance, renters insurance, life insurance, and other insurance options are provided by almost all of the main home insurance companies. You can lower the cost of your coverage by combining your home insurance with your auto insurance or another type of insurance.
3. New construction – Your house is less likely to sustain damage if it was built lately than if it was built in the 1920s. The most substantial homeowner insurance discounts are those for newly built homes, so if your house is new, ask your insurance company whether there might be one available.
Does home insurance cover appliance breakdowns?
No, only if the damage was brought on by one of the insured perils will house insurance pay for repairs and replacements. House insurance does not cover routine issues brought on by normal wear and tear, but a home warranty frequently does.
Which homeowners insurance company is best?
There are a number of trustworthy national providers that we endorse, but Allstate received the highest rating and was our top choice for homeowners insurance in our study of the best home insurance providers.
Is home insurance mandatory?
Home insurance is not needed by law, but if you have a mortgage, your lender may insist that you carry a coverage. Even if you are not legally required to have a policy, we advise acquiring home insurance to give you peace of mind and to safeguard your house and its contents.