What Is the Average Cost of Homeowners Insurance?
Financial Services

What Is the Average Cost of Homeowners Insurance?

The average cost of homeowners insurance in the U.S. is $1,631 a year, according to NerdWallet’s 2020 analysis. This estimate is based on a policy for a 40-year-old homeowner with:

  • $300,000 in dwelling coverage.

  • $30,000 in other structures coverage.

  • $150,000 in personal property coverage.

  • $60,000 in loss of use coverage.

  • $300,000 in liability coverage.

But the cost of your homeowners insurance will depend on your location and house size, and how much coverage you need. We’ve analyzed pricing data from 145 insurance companies to bring you average homeowners insurance costs in every state, as well as the largest U.S. cities.

How much is homeowners insurance in your state?

Where you live is a big factor in how much you’ll pay for homeowners insurance. Hover over your state on the map below to see the average cost of homeowners insurance coverage.

The cost of homeowners coverage varies widely. Our analysis found that average homeowners insurance rates fall under $1,000 in some states, including Hawaii, Delaware and Vermont. Meanwhile, other states can see annual rates reach above $3,000, on average, including in Kansas, Oklahoma and Texas.

Here are average annual and monthly homeowners insurance rates by state.

Here are the cheapest states for homeowners insurance:

  1. Hawaii: $483 a year, or about $40 a month, on average.

  2. Delaware: $747 a year, or about $62 a month, on average.

  3. Vermont: $801 a year, or about $67 a month, on average.

  4. New Hampshire: $806 a year, or about $67 a month, on average.

  5. Pennsylvania: $872 a year, or about $73 a month, on average.

These are the most expensive states for homeowners insurance:

  1. Kansas: $3,644 a year, or about $304 a month, on average.

  2. Oklahoma: $3,548 a year, or about $296 a month, on average.

  3. Texas: $3,257 a year, or about $271 a month, on average.

  4. Nebraska: $3,201 a year, or about $267 a month, on average.

  5. Arkansas: $2,684 a year, or about $224 a month, on average.

How much is homeowners insurance in your city?

We analyzed prices in the 20 largest metropolitan areas in the U.S. to find the average cost of homeowners insurance in each city. Houston had the most expensive average rate at $3,835 a year. Meanwhile, Philadelphia is the cheapest city on the list, with an average annual rate of $1,060.

Average cost of homeowners insurance by company

We looked at average rates at nine of the 10 largest homeowners insurance companies in the U.S. by market share (pricing data wasn’t available for Liberty Mutual).

Travelers came in as the cheapest on the list, with an average annual rate of $1,425. Meanwhile, American Family is the most expensive, with an average annual rate of $2,323.

Here are annual average rates for the large companies. Note that some may not offer homeowners insurance in your state.

*USAA is available only to military, veterans and their families.

What is included in a homeowners insurance rate?

Homeowners insurance policies typically include six standard coverage areas:

  • Dwelling. This will pay for damage to your home from a covered incident, such as a fire or windstorm.

  • Personal property. This pays for your personal belongings if they are stolen or damaged.

  • Other structures. This covers structures on your property that aren’t attached to your house, such as a fence or shed.

  • Loss of use, or additional living expenses coverage, will pay for you to stay elsewhere when your home is uninhabitable due to covered damage.

  • Personal liability is coverage that pays if you injure someone through negligence or cause accidental property damage.

  • Medical payments will pay medical bills for anyone injured on your property, no matter who is at fault.

What factors affect the cost of homeowners insurance?

There are a variety of factors that insurers use to price homeowners insurance rates. Here are some of the most common:

Your home. Older homes cost more to insure because they typically don’t have the safety features that newer homes do, and repairs can be costly. But even if your home is new, the materials used to build it will have an impact on your homeowners insurance cost. For example, houses made of concrete are usually cheaper to insure than those made of wood because they’re sturdier and less prone to fire damage.

Where you live is one of the biggest factors in the cost of your home insurance. Details such as how close you live to a coast, crime rates in your neighborhood, how far your home is from a fire department and whether you live somewhere with regular storms or earthquakes all affect your insurance rate.

Your roof. The condition and construction of your roof matters to home insurers. For example, a roof made of asphalt may get you a lower rate because it isn’t as flammable as other materials.

Renovations. Certain home upgrades could result in lower homeowners insurance costs — such as upgrading your home to be more energy efficient.

Your dog. If you have a dog that is deemed an aggressive breed, this can increase the cost of your home insurance — or even cause you to be denied coverage.

Special features. Swimming pools, trampolines and other special features can increase the cost of your homeowners insurance as they have a high potential to cause injury.

Your coverage limits. The higher your liability and property coverage limits are, the more you may pay for home insurance.

Your deductible. A higher deductible will mean a lower homeowners insurance rate. Just make sure you have enough cash tucked away to pay it if you need to file a claim.

Your claims history. If you have previous homeowners claims, you’ll likely pay a higher rate.

Your credit history. Good credit leads to lower homeowners insurance rates.

Homeowners insurance discounts

  • Multiple policies. If you bundle your homeowners insurance with another product, such as car insurance, you could get a discount.

  • Safety and security devices. If your home is equipped with fire alarms, deadbolts, security cameras and other security devices, many home insurers offer a discount.

  • Claims-free. Many insurers offer a discount to homeowners who haven’t filed a claim recently, typically in the past three to five years.

What's your reaction?

Excited
0
Happy
0
In Love
0
Not Sure
0
Silly
0

You may also like

Leave a reply

Your email address will not be published. Required fields are marked *