Home insurance plays a vital role if you’re a homeowner, but home insurance costs can reach well over $1,000 annually, depending on the policy and where you live.
The best homeowners insurance protects your biggest assets—your home and belongings. Though it can be pricey, there are ways to save on home insurance.
How Much Is Homeowners Insurance?
The average homeowners insurance costs $1,678 per year for a policy with $350,000 of dwelling insurance, according to Forbes Advisor’s analysis.
We analyzed rates across the nation to find the average cost of homeowners insurance. Your exact price will depend on specific personal details, such as the location and age of your house and the coverage limits you choose. However, our analysis can give you an idea of what you might expect to pay.
Average Cost of Homeowners by Dwelling Coverage
Your dwelling coverage limit should match the amount it would cost to rebuild your house. The higher your rebuilding costs, the higher your limit and the cost of your homeowners insurance.
Average Cost of Homeowners Insurance by State
The average cost of homeowners fluctuates depending on where in the country you live. People in states that have a higher number of claims—due to catastrophic weather, high crime rates or elevated costs for repairs—will see higher prices for home insurance.
Cheapest States for Homeowners Insurance
The top five cheapest states for home insurance (for $350,000 in dwelling coverage) are:
- Hawaii: $380 a year
- Nevada: $883 a year
- Vermont: $895 a year
- New Jersey: $968 a year
- New Hampshire: $970 a year
Most Expensive States for Homeowners Insurance
The top five most expensive states for home insurance (for $350,000 in dwelling coverage) are:
- Oklahoma: $4,025 a year
- Nebraska: $3,957 a year
- Louisiana: $3,528 a year
- Arkansas: $3,055 a year
- Colorado: $2,792 a year
States prone to severe weather like tornadoes and hurricanes are more likely to have higher home insurance rates.
Average Cost of Homeowners Insurance by Company
Homeowners insurance costs $729 per year with Progressive for a policy with $350,000 of dwelling coverage. Progressive has the cheapest average annual cost for homeowners insurance across the dwelling coverage limits we analyzed of $200,000, $350,000, $500,000 and $750,000.
Travelers is the most expensive homeowners insurance company for $200,000, $350,000, $500,000 and $750,000 dwelling coverage amounts.
Rates vary significantly among companies because they each have their own formulas for pricing. That means it’s vital to comparison shop homeowners insurance quotes when buying a policy. You don’t know which company will offer you the best rates—and possibly save you hundreds of dollars—until you shop around.
Average Cost of Home Insurance by Company ($200,000 in Dwelling Coverage)
*USAA home insurance is available only to the military, veterans and their families.
Average Cost of Home Insurance by Company ($350,000 in Dwelling Coverage)
*USAA home insurance is available only to the military, veterans and their families.
Average Cost of Home Insurance by Company ($500,000 in Dwelling Coverage)
*USAA home insurance is available only to the military, veterans and their families.
Average Cost of Home Insurance by Company ($750,000 in Dwelling Coverage)
*USAA home insurance is available only to the military, veterans and their families.
The 5 Cheapest Homeowners Insurance Companies
Our analysis of the home insurance rates found that the cheapest home insurance companies are:
- Progressive
- Westfield
- Nationwide
- Erie
- USAA
When shopping for a home insurance policy, these companies are a good place to start, but remember that USAA is only available for military members, veterans and their families.
Average Cost of Homeowners Insurance by Deductible Amount
The average cost of home insurance is $1,703 per year for a $350,000 dwelling limit with a $500 deductible, according to our analysis. Home insurance costs will vary depending on the deductible that you choose. Home insurance deductibles options typically range from $250 to $2,500.
A homeowners insurance deductible is the amount your insurance company subtracts from a claim payment. For example, if you file a homeowners insurance claim for $5,000 worth of damage and your deductible is $1,000, your claim payment check would be reduced to $4,000.
Average Cost of Home Insurance Based on Deductibles
Rates are based on $350,000 in dwelling coverage.
A homeowners insurance deductible applies when you make a home insurance claim for property damage. The deductible does not apply if someone makes a liability home insurance claim against you.
What Affects My Home Insurance Rates?
There are many factors insurance companies usually use to determine home insurance rates, including:
- Fire rating of your home’s location (how close are you to a fire hydrant or water source and fire department).
- The claims history at your property.
- The cost to rebuild the house.
- The coverage and policy limits you choose.
- The deductible you select.
- The house age.
- The materials used to construct the house, such as wood, stone or brick.
- Your credit (except in California, Maryland and Massachusetts).
- Your home’s location.
- Your personal home insurance claims history.
How to Reduce Home Insurance Costs
You can’t up and move your house, but there are ways to lower your homeowners insurance costs.
Raise Your Deductible
Raising your deductible is one change you can make to save money. Our analysis of home insurance deductibles found that if you bump up your deductible from $500 to $1,000 or higher it will lower your rates by over $100 annually on average. You take on more of the financial burden if you file a claim, which translates to a lower home insurance premium.
Compare Home Insurance Quotes
One of the best and easiest ways to find the cheapest home insurance is by comparing quotes from multiple companies. Check rates from at least three so that you can start to see the range of potential costs.
Proactively Ask About Home Insurance Discounts
Don’t assume your home insurance company is automatically giving you all the discounts you qualify for. Asking for a review of home insurance discounts is an excellent way to possibly reduce your home insurance costs.
For example, adding smart home technologies or a home security system can earn a discount. Buying your home and auto insurance from the same company, called bundling, can snag a discount, too.
Related: How much Homeowners Insurance do you need?
What Does Home Insurance Cover?
A standard homeowners insurance policy, also known as an HO-3, covers your dwelling (house) for any problem except ones listed as exclusions in the policy. Common exclusions are damage from floods and earthquakes. A homeowners policy also covers your personal property, such as furniture and clothes.
While your house and belongings are two of the main items protected by homeowners coverage, there is much more to what a home insurance policy covers.
Dwelling (House Structure) Coverage
This pays to repair or replace (rebuild) your house and attached structures, like a garage or deck. The dwelling insurance limit should cover the cost of rebuilding your house.
Other Structures Coverage
This covers damage to property not attached to your house, such as a shed or gazebo. The coverage amount usually is 10% of your dwelling coverage limit but you can increase it.
Loss of Use
Also known as additional living expenses, loss of use insurance pays for extra costs you incur if you’re unable to stay in your home due to a problem covered by your policy. Expenses could include hotel costs, restaurant bills and services, such as boarding a pet. Loss of use coverage is generally set at 10% to 30% of your dwelling coverage limit.
Personal Property Insurance
This covers damage or loss (through theft or destruction) of your personal belongings, such as clothes, electronics, furniture and appliances. Coverage typically is set at 50% to 70% of your dwelling coverage limit, depending on what you choose when you start your policy.
You can schedule your personal property so that high-value items are fully insured. Scheduled personal property—also called an endorsement, floater or rider—is an optional coverage that provides more coverage for expensive items you own.
Personal Liability
This covers accidental damages or injuries you cause to others. For example, if your dog gets loose and bites someone at the park, the injured person might make a liability claim against you or sue you. Personal liability in home insurance covers settlements, judgments against you and lawyer costs—but only up to the liability limits of your policy.
You can choose a liability limit for home insurance, which commonly starts at $100,000, although it’s wise to have enough to cover what could be taken from you in a lawsuit.
Medical Payments to Others
This type of coverage is also called guest medical. It covers minor injuries to people who aren’t household members—for instance, a guest who slips on icy steps. The amounts for medical payments coverage typically range from $1,000 to $5,000.
Methodology
Average home insurance rates were calculated using data from Quadrant Information Services. We analyzed home insurance rates based on a 40-year-old female homeowner with good credit, no past claims, a $500 deductible and the following coverage limits (unless otherwise noted):
- Dwelling coverage: $350,000
- Other structures: $35,000 (10% of dwelling limit)
- Personal property: $175,000 (50% of dwelling limit)
- Loss of use: $35,000 (10% of dwelling limit)
- Liability: $100,000
- Medical payments to others (guest medical): $1,000
