How much homeowners insurance costs, based on your state and your home's value

Your homeowners insurance premiums are based on where you live, your coverage amount, your home's age and condition. and a host of other factors.

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• The average homeowners insurance premium in the United States is $1,272 a year.
• Your home's value, location, and coverage amount all impact the price you pay.
• Adding safety features, bundling your policies, and raising your deductible can lower your premiums.

Unlike with physical objects like a refrigerator or a car, it can be difficult to pinpoint the cost of homeowners insurance. Apart from taking the time to ask all your friends, family, and neighbors what they pay in premiums, it's hard to know if the quote you've received is outrageous or a steal.

Fortunately, there's a lot of data available to help you set realistic expectations for your homeowners insurance cost. This article will look at how much the average homeowner is paying in homeowners insurance premiums, the factors that affect your specific policy, and ways you can save.

The average cost of homeowners insurance

The average annual premium in the United States in 2021 was $1,272, according to the most recent data from the Insurance Information Institute. 

But, each home's costs for insurance vary widely based on a variety of factors, including your home's value.

Here's how much homeowners insurance costs on average by home value in the United States, according to the most recent release of the Homeowners Insurance Report by the National Association of Insurance Commissioners (NAIC):

*The above table uses data from the NAIC.

The average cost of homeowners insurance by state

Where you live will also impact your cost of homeowners insurance. If you live in an area with high real estate values, this also means that it would cost more to replace your home if it were destroyed. So the NAIC says that average premiums tend to be higher in densely populated areas.

Second, your potential exposure to catastrophe plays a significant role in what you pay for homeowner's insurance. If you live in an area that's prone to floods, earthquakes, or tornadoes, you can expect to pay more than someone who lives in an area with less risk of experiencing a natural disaster.

Here's the average annual homeowners insurance premium by state, according to 2019 data from the Insurance Information Institute.

*The above table uses data from the Insurance Information Institute

Most expensive states for homeowners insurance

Here are the states where annual homeowners insurance premiums are least affordable, on average, according to Insurance Information Institute.

*The above table uses data from the Insurance Information Institute

Cheapest states for homeowners insurance

Here are the states where annual homeowners insurance premiums are most affordable, on average, according to the Insurance Information Institute.

*The above table uses data from the Insurance Information Institute

The average cost of homeowners insurance – Frequently asked questions (FAQ)

What is homeowners insurance?

Homeowners insurance covers your dwelling, personal property, offers liability protection, and covers you for additional living expenses if your home becomes inhabitable due to damage. While homeowners insurance is not required by law, your mortgage lender may require you to have it. 

What are some factors that affect the cost of homeowners insurance?

Your home's value and location are two of the most significant variables that affect homeowners insurance prices. However, a few other factors can drive your premiums up or down. 

Coverage levels

The type of coverage you choose will impact the price you pay for homeowners insurance. Cash value coverage is typically the most affordable. With this type of coverage, your insurance company will only pay what your property is worth minus depreciation, not what it would cost to replace your home and its belongings.

For more protection, you can choose replacement cost coverage instead. With this type of policy, your insurer will pay out what it would cost to repair or rebuild your home in today's dollars.

For example, if a tree fell through your house and destroyed your couch, a replacement cost policy would pay whatever it costs to replace the couch. But a cash value policy would only pay what the couch is worth today. And if the couch is several years old, its value could be much less than what you originally paid.

You can expect to pay more for replacement cost coverage, but it may be worth it to protect yourself against coverage gaps caused by depreciation.

Other variables that affect your homeowners insurance: 

• The deductible you choose: As a general rule, premiums go down as deductibles go up.
• Age of your home: Older homes often require more work to rebuild to modern safety standards, so they can cost more to insure than newer homes.
• Condition of your roof: If your roof is relatively new and in good condition, you'll typically pay less than a homeowner with a roof that's old or built with lower-quality materials
• Past claims: You can expect to pay more if you've made several claims in the past or live in an area with a high claims rate.

What are some ways to save on your homeowners insurance premiums?

Add features to make your home safer: If you're looking for ways to reduce your homeowners insurance premiums, think about ways you could improve the safety of your home. Adding any of the following safety features to your home could qualify you for a homeowners insurance discount:

• Smoke detectors
• Deadbolt locks
• Fire extinguishers
• Storm shutters
• Security system
• Sprinkler system
• New or reinforced roof

Bundle your insurance policies: You may also be able to save on homeowners insurance by bundling your home and auto insurance policies together. 

Raise your deductible: Finally, raising your deductible could reduce your premiums. But make sure that you don't set a premium that's higher than you'd be able to pay without going into debt. And know that if you have a mortgage on your home, your lender may require that your deductible stays below a certain limit.

Shop around: The last variable that can impact the price you pay for home insurance is the company you choose. Premiums can vary widely by insurance company. So one of the best ways to save on homeowners insurance could be simply to make sure that you shop around before choosing an insurance provider.

Aim to get at least three to five quotes before choosing a home insurer. Or, to save time, you could use an online homeowners insurance shopping tool like Policygenius to compare dozens of insurance companies at once.