How much should my home insurance cost

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Home insurance is essential if you’re a homeowner. Sure, your mortgage company requires it, but you’re the one that truly needs it and will benefit from the coverage. Homeowners insurance protects your biggest assets—your home and belongings.

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.

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Average Cost of Homeowners Insurance by Company

The national average cost of homeowners insurance is $1,854 per year, according to a Forbes Advisor analysis. This is for a home insurance policy with $300,000 of dwelling coverage and $100,000 of liability coverage.

Among large home insurance companies, we found Progressive was the cheapest at an average of $1,236. Travelers was the most expensive at $2,871, which is $1,635 more than Progressive.

Rates vary significantly among companies because they each have their own formulas for pricing. That means it’s vital to comparison shop when buying a homeowners 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 Homeowners Insurance by State

Our analysis of average homeowners insurance rates by state found that Hawaii is the cheapest state for homeowners insurance at an average of $558. On the other end of the spectrum is Oklahoma, which has an average annual rate of $4,122. The $3,564 difference in costs shows that a home’s location really does matter.

States rounding out the top five cheapest states for home insurance are:

Utah: $817
Oregon: $834
Vermont: $944
New Hampshire: $961

Among the most expensive states for home insurance, we see others like Oklahoma that are more or less in the middle of the country and are prone to severe weather:

Nebraska: $3,309
Kansas: $3,035
Texas: $3,013
Louisiana: $2,988

Average home insurance rates by state

Factors in Home Insurance Rates

There are several factors insurance companies usually use to determine home insurance rates, including:

Your home’s location
The cost to rebuild the house
The materials used to construct the house, such as wood, stone or brick
The house age
Fire rating of your home’s location (how close are you to a fire hydrant or water source and fire department)
Your personal claims history
The claims history at your property
The coverage and policy limits you choose
The deductible you select
Your credit (except in California, Maryland and Massachusetts)

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 your policy. Common exclusions are damage from flooding and earthquakes.

While your house and belongings are two of the main items covered by homeowners coverage, there is much more to a home insurance policy.

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 to rebuild 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.

Related: What does homeowners insurance cover?

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. If you bump up your deductible from $500 to $1,000 or higher, it will lower your rates a bit. You take on more of the financial burden if you file a claim, which translates to a lower premium.

Compare home insurance quotes

One of the best and easiest ways to save is by comparing home insurance rate quotes with multiple companies. Check rates from at least three so that you can see the range of potential costs. The cost of home insurance can vary greatly from one insurance company to another.

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: Cheapest Homeowners Insurance Companies Of 2022

Find the Best Homeowners Insurance Companies Of 2022

Methodology

Average home insurance rates were calculated using data from Quadrant Information Services. Rates are based on a policy with dwelling coverage of $300,000 and liability coverage of $100,000.

How much does most homeowners insurance cost?

The average cost of homeowners insurance throughout the United States is $1,383 per year for a policy with $250,000 in dwelling coverage. However, your actual rates may vary depending on a variety of factors.

How much is homeowners insurance in Virginia?

Homeowners insurance in Virginia costs an average of $1,531 a year or $128 a month. American Family is the cheapest homeowners insurance company in Virginia, but your rates will vary, so shopping around is vital.