House Insurance Costs by State

Home insurance, one of the most important protections that can be bought, is a relatively expensive part of budgets for most people.

Even if you don’t own your own home, your landlord may request that you purchase insurance to protect both the contents of your rental home, condominium, or apartment from physical damage to property and your possible liability for injury to guests and visitors.

In 2011, the average cost for home insurance in the United States was $978 a year for people who own their own home and $187 for renters insurance.

The cost will vary according to the amount of coverage you purchase and the perils you choose to cover in your policy.

If you remember Junior High Math classes, you are aware that averages reflect the middle costs. An equal amount of policies will cost less than the average as cost more.

How Home Insurance Rates Are Determined

An insurance company’s rates are generally based upon the following criteria:

  • Age of the house, apartment building, or condominium – older houses usually cost more to insure due to condition of their heating, plumbing, wiring, and roofing; whereas, new buildings often receive credits or discounts for their newer systems.
  • Construction of the building – frame houses cost more to insure than brick houses because they are more flammable.
  • Local fire protection – the distance from fire hydrants and the quality of local fire departments can affect your premiums. The Insurance Services Offices has a national rating system to apply to each fire district.
  • Deductible – The higher your deductible, the less your home insurance will cost. Compare these costs carefully to ensure that you save money commensurate with the discount offered.
  • Discounts are often offered for a variety of things – insuring your home and car with the same insurance company, installation of burglar alarms, or increasing internal fire protection.

Variations in Rates From State to State

Basic insurance rates vary from state to state for a number of reasons. Some of these variations are due to:

  • Loss ratios for home owners from state to state based on many factors
  • Weather patterns in your state – for example, a state prone to hurricanes will have different loss ratios from one with a pattern of tornadoes.
  • Climate – high contrast between heat and cold; very damp; extremely arid
  • Urban and non-urban population as well as rates of crime such as vandalism and theft
  • General terrain of the area – mountains, forests, rivers, and plains can all make a difference in the losses occurring in a state and thus the insurance rates

Examples of Average Premiums for Homeowners Insurance by State (2011)

Insurance Information Institute

(Note: This is not a full listing of the statistics)

Arranged from most expensive to least expensive:

state home insurance ratesState Homeowners Average Premium

  • #1 (Highest) Florida $1,933
  • #2 Louisiana $1,672
  • #3 Texas $1,578
  • #4 Mississippi $1,409
  • $5 Oklahoma $1,388
  • #46 Washington $628
  • #47 Wisconsin $592
  • #48 Utah $583
  • #49 Oregon $559
  • #50 Idaho $518

If you note, the states of Florida, Louisiana, and Texas have the highest average premiums. These states have natural disasters such as hurricanes and tornadoes. Mississippi and Oklahoma have a great many tornado and weather-related disasters.

The lower average premiums show up in states such as Washington, Oregon, Utah, Idaho, and Wisconsin with fewer natural disasters applying.

You should be aware that homeowners and renters insurance does not give coverage against flood or earthquakes. For flood insurance, you need to contact FloodSmart, a government website, to obtain information about subsidized coverage.

Earthquake coverage can be obtained through a local agent. Ordinarily, too, coverage against sinkholes that occur spontaneously is not provided except in Florida and Louisiana where it is required by law.

Purchasing Homeowners And Renter’s Insurance Coverage

If you are shopping for homeowners or renters insurance for your home, begin with looking at the average cost of this types of insurance in your state. Then request at least three quotations from various companies within your state for prices.

Step 1: Consider the value of the property you are insuring.

When estimating the replacement cost of your home, should you own it, begin with an online cost estimator. Your insurance agent will have one available or you may go online to Building-Cost.net and figure the cost to replace the building. Recognize that the cost of the property, i.e. lot, should not be included in the building coverage because land is permanent.

Determine whether you wish to purchase replacement cost coverage or actual cash value coverage on the building and contents.

Replacement cost coverage will replace the property less the deductible. Actual cash value takes into consideration depreciation from age, wear and tear, and use less the deductible.

If you are planning to cover only the contents of the home, as you would under a renter’s policy, begin with a home inventory. The inventory will give an idea of the replacement cost for the contents of your rental or condominium. Inventories are time-consuming, but well worth the time spent to complete.

Determine the limits of liability you need to protect yourself should someone decide to sue you because of a problem at your home, whether rented or not. Liability coverage under a homeowner’s policy is broad and usually follows members of the household. This liability coverage is valuable in scope because it covers a number of actions that you may not consider.

Step 2: Determine the perils for which you need to be covered. 

house insurance quotesThe usual homeowners policy covers the following:

  • Fire, smoke, explosion, lightning
  • Windstorm, hail
  • Vehicles, civil unrest
  • Trees and other falling objects (but not cleanup after the fall)
  • Weight of ice, snow, and sleet
  • Sudden and accidental freezing, rupturing, or overflow of plumbing, HVAC system, or household appliance

Step 3: Choose a selection of insurance companies.

 For quotations, choose at least three companies. The insurance department for your state can give you the names of companies licensed within your state.

You can find the website by referring to the National Association of Insurance Commissioners (NAIC) and clicking on your state. An excellent approach, also, would be to ask your neighbors, friends, and relatives about insurance companies that they use.

Examine the financial status and complaint ratio of your chosen insurance companies on the following sites:

You need to check both the financial status and complaint ratios to determine the financial viability of the insurance company for paying claims as well as its reliability and promptness in paying claims.

Step 4: Organize your information.

 The information needed to obtain quotations is as follows:

  • Building coverage amount – based upon your research. This is not necessary if you just want to purchase renter’s coverage.
  • Contents coverage amount – again based upon your research.
  • Amount of Liability coverage desired.
  • Deductible you can afford – your mortgage company may recommend this, but be careful to strike a balance between the affordable amount and credit for the deductible.
  • Medical payments desired – from $500 to $5,000, depending upon your desires. Medical payment is a convenient type of liability coverage that will pay for slip-and-fall injuries and dog bites.

The insurance company will want to know your address, the construction of the building, and age of the building.

Step 5: Assess the quotations you acquire. 

Compare the quotes, companies, and assess the premiums, then determine where to purchase your insurance.

After receiving your policy, examine it carefully to determine that you understand the contract. Keep it carefully filed along with the research you have done at this point. Plan to do the research again next year.

Use our FREE quote comparison tool below!