If you own your home, you're likely paying for homeowners insurance.

You may pay your insurance company directly, or your escrow account may pay them for you.

That doesn’t mean, however, that you can’t shop around to lower the cost of your home insurance.

homeowners insurance cost

However, shopping for homeowners insurance can be a daunting task. Insurance companies don’t always offer comparable coverage at similar prices. 

Let’s take a look at what homeowners insurance costs and where you’re likely to find the highest—and lowest—premiums

​In This Article



Average Homeowners Insurance Cost by State

In 2017, the average cost of homeowners insurance was $1,211.

While 95 percent of homeowners in the United States have homeowners insurance, about 60 percent of them are underinsured.

How much does homeowners insurance cost on average in 2020? The annual average home insurance cost still runs about $1,200 a year.

Homeowners insurance protects your home and belongings and pays legal and medical bills if someone is injured on your property.

With the number of natural disasters increasing every year, having a comprehensive homeowners insurance plan is more important than ever.

INSURANCE WHERE YOU LIVE

Home insurance by state.

The Most Expensive States for Homeowners Insurance

Your homeowners insurance cost will depend on your home, the coverage you need, and where you live.

Urban areas, for example, will have higher premiums, whereas rural locations will be lower.

The frequency of natural disasters in your area also plays a factor. States with more incidents will have higher premiums.

The most expensive state is Louisiana, with premiums averaging around $1,968 a month, according to the Insurance Information Institute (III).

Florida and Texas are up there as well, coming in at $1,937 and $1,918, respectively. Coastal states deal with hurricanes and sustain damage from high winds and water.

Oklahoma and Kansas are 4th and 5th on the list, due to their presence in Tornado Alley.

Oklahoma’s premiums average $1,875 a year, while Kansas drops to $1,548 annually.

To recap, the top five most expensive states for home insurance are:

  • Louisiana: $1,967
  • Texas: $1,937
  • Florida: $1,918
  • Oklahoma: $1,875
  • Kansas: $1,548

The Cheapest States for Homeowners Insurance

Just as the states that face the highest risk of damage pay a higher average home insurance cost, states with milder weather pay lower premiums.

Again, according to the III, the state with the lowest homeowners insurance is Oregon.

Homeowner’s there only pay $659 a year to insure their homes. Utah follows closely with annual premiums of $664. Idaho, Nevada, and Wisconsin are next, with payments of $703, $742, and $762, respectively.

These states fall well below the national average of just under $1,200.

To recap, the top five cheapest states for home insurance are:

  • Oregon: $659
  • Utah: $664
  • Idaho: $703
  • Nevada: $742
  • Wisconsin: $762

What Determines the Cost of Home Insurance?

As mentioned, your insurance company determines your premium based on several things, such as location, the age of your home, and the amount of coverage you need.

Your Home: The age of your home affects your policy costs. How old is the plumbing? When was the roof last replaced? Is the wiring copper or aluminum? (The presence of aluminum wiring will increase your costs, as it comes with a higher fire risk than copper.)

Additionally, the presence of a security system and smoke and carbon monoxide alarms can affect your policy costs. Even such things as whether you live in a gated community or not can impact your homeowners insurance cost.

Location: The location of your home is one of the largest factors insurance companies take into consideration when creating your policy. Is your home located in a rural or urban setting? What’s the population density and crime rate? How far away is the police and fire station? Do you live in an area that is prone to natural disasters?

All of these components can increase or decrease the average cost of homeowners insurance.

Credit History: Most insurance companies check your credit history when determining your homeowners insurance cost.

Coverage Levels: Your insurance company will give you several coverage amount options. This amount varies based on your choices. Some of the levels you can adjust are for personal property, liability, and any additional protection you may need. 

For example, Louisiana homeowners may consider adding flood insurance, while California homeowners should contemplate earthquake insurance.

If you have a valuable collection or high-value jewelry, you might also want to take an additional policy to cover these items separately from your homeowners insurance.

Deductible: This is another option that you can adjust to suit your financial needs. A deductible is the amount of money you must pay before insurance kicks in and pays out.

Your deductible can be as low as $500 and increases from there. If you have a high deductible, your homeowners insurance cost will be lower per month.

Discounts: Most insurance companies offer discounts to their clients.


Everything from bundled policies, military discounts, or corporate rates can lower the average cost of homeowners insurance.

THE SIMPLY INSURANCE WAY

Home Insurance made easy.

Agents not required.

Get quotes and sign up online without talking to an agent. But, we are here if you need us.

Unbiased, expert advice.

Get unbiased insurance education from licensed experts and also avoid dodgy sales calls.

Coverage in minutes.

You can get home insurance coverage within minutes of getting your quotes and applying.

How Much Homeowners Insurance Do You Need?

Your homeowners insurance covers several things:

  • Dwelling coverage
  • Other structures
  • Personal property
  • Loss of use
  • Liability
  • Medical payments
average cost of home insurance

Each of these components has different coverage levels, many of which you can adjust when you build your policy.

Your dwelling coverage should be at a high enough level to ensure you can replace your home. 

This coverage amount should be equal to the replacement value of your home rather than the market cost or the purchase price. 

The other structures rider of your policy covers detached garages, sheds, fences, and driveways. It is usually 10 percent of your home’s value.

Personal property covers your belongings. It is wise to make an inventory list or take pictures and video of your belongings and estimate their value.

If you have any high-value items like jewelry or investment metals, you should consider a separate policy for them rather than increasing this number higher than 50 percent of your home’s cost.

There are several free inventory sheets online for Excel or Google Sheets.

Loss of use kicks in if you are unable to use your home in the case of a covered peril. It typically equals 20 percent of your dwelling coverage amount. 

Your liability coverage should be enough to cover your home, belongings, automobiles, etc. Liability protects all your assets—even investments.

Most insurance policies place this at around $500,000. If your assets are worth more, you can purchase an umbrella policy to increase your limit.

If someone is injured in your home, and they sue you, your medical payments coverage will cover those costs. 

Feel free to use our homeowners insurance cost calculator to help you determine how much coverage you will need.

How to Save on Homeowners Insurance

Saving on your homeowners insurance cost is easy.

First, finding an insurance company that offers discounts will have an immediate impact on your average home insurance cost.

Things like installing security alarms, smoke detectors, and sprinkler systems can reduce your monthly premium as well.

Additionally, having fire extinguishers and deadbolts on your door will also garner a discount on your policy.

Ask your insurance agent how you can further save on your homeowners insurance cost.

THE SIMPLY INSURANCE WAY

Home Insurance made easy.

Agents not required.

Get quotes and sign up online without talking to an agent. But, we are here if you need us.

Unbiased, expert advice.

Get unbiased insurance education from licensed experts and also avoid dodgy sales calls.

Coverage in minutes.

You can get home insurance coverage within minutes of getting your quotes and applying.

Taking Action

The average cost of homeowners insurance is variable. It depends on many things, some of which you can control, and others you can’t.

You don't need to waste any more time paying too much for your home insurance, it's time to update your policy.

And guess what: 

If you want to update your homeowners insurance, we’ve done the hard work for you—check out the top three companies or get your free quote for home insurance


Sa El

About the author

Sa El is the Co-Founder of Simply Insurance and a licensed Insurance Agent with over 11 years of experience in the industry.  He specializes in Life & Health Insurance and is certified in Long Term Care Insurance in the state of Georgia. He is also an Official Member of the Forbes Finance Council, a licensed real estate agent in the state of Georgia (License #382602), an entrepreneur, insurance educator, and freelance writer.

Your Signature


{"email":"Email address invalid","url":"Website address invalid","required":"Required field missing"}