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Average Home Insurance Cost

Jason Metz

The average home insurance cost is $1,192 a year, according to the National Association of Insurance Commissioners’ latest home insurance report.

Texas and Florida have the most expensive average cost of homeowners insurance, based on the most common policy type, called an HO-3 policy. Utah and Oregon have the least expensive average home insurance cost.

Average home insurance rates vary by state and the amount of insurance purchased. When you’re getting home insurance quotes, you want an insurance amount that covers the cost of rebuilding your home from the ground up. That’s an amount for a worst-case scenario, such as a fire or tornado that completely destroys your home. Use the map below to see the average home insurance cost in your state.

To make a homeowners insurance estimate for rebuilding costs, multiply the square footage of your house by the local cost per square foot of construction. Your home insurance agent can help you figure out the right amount of insurance.

It cost an average of $237,760 to construct a typical single-family home in 2017, according to the most recent survey by the National Association of Home Builders.

Do you pay home insurance monthly or yearly?

Depending on your mortgage lender and home insurance company, you may be able to choose to pay for home insurance yearly as a lump sum payment, in monthly installments or have it deducted from your escrow account.

If you pay for home insurance through an escrow account, your mortgage lender might pay your home insurance premiums yearly on your behalf. The average home insurance cost per month is $99.33 according to the National Association of Insurance Commissioners’ 2018 home insurance report.

Is your homeowners insurance included in your mortgage payment?

Some mortgage lenders include homeowners insurance with your mortgage payment. This is done by paying your home insurance through an escrow account. You’ll put money in your escrow account, and your lender will use the funds to make payments such as your mortgage payment, property taxes and home insurance.

Depending on your mortgage lender, escrow may be required. If escrow is not mandatory, you may be able to “waive escrow” and make home insurance payments directly to the insurance company.

Keep in mind, your homeowners insurance is not the same as private mortgage insurance (PMI). PMI is typically required for home buyers who can’t make a down payment of 20% (or more) and helps protect the mortgage lender -- not you -- in case you stop making mortgage payments.

Why does my home insurance go up every year?

Home insurance rates might go up every year due to several factors, such as making a home insurance claim, getting a dog or a installing a swimming pool.

But some factors are out of your control. For example, home insurance rates can increase to account for higher labor and materials costs if you need to rebuild or repair a home. Goods and services used in construction increased 3.8% from December 2017 to December 2018, according to the Associated General Contractors of America.

Also, rates can go up if your area has experienced disasters that have resulted in many claims from others.

What factors into home insurance rates?

Home insurance companies use information about you and the property to determine your rate. This includes:

  • The cost to rebuild the home.
  • The age of the house (newer homes can be cheaper to insure).
  • Your town’s fire protection rating (called a Public Protection Classification from ISO).
  • Claims in your area or neighborhood (for example, frequent weather-related claims).
  • The amount of insurance needed and the deductible you choose.
  • Your history of making home insurance claims.
  • Your credit (banned for use in home insurance rates by California, Massachusetts and Maryland).

How can I lower my home insurance cost?

There are several ways you can lower home insurance cost, including:

  • Compare home insurance quotes from a few companies to find a good deal.
  • Raise your deductible, which is the amount deducted from a claims check.
  • Bundle your home and auto insurance for a discount.
  • Ask your insurance agent what other discounts are available, such as security-system discounts.
  • Try to keep your home insurance claims record clean, if possible. Don’t make claims for small problems, which can lead to a rate increase at renewal time.

Average home insurance cost by state

State Average annual home insurance cost
Alabama $1,386
Alaska $974
Arizona $803
Arkansas $1,348
California $1,000
Colorado $1,446
Connecticut $1,445
Delaware $816
District of Columbia $1,225
Florida $1,918
Georgia $1,200
Hawaii $1,026
Idaho $703
Illinois $1,042
Indiana $1,003
Iowa $945
Kansas $1,548
Kentucky $1,085
Louisiana $1,967
Maine $866
Maryland $1,022
Massachusetts $1,451
Michigan $952
Minnesota $1,340
Mississippi $1,525
Missouri $1,280
Montana $1,130
Nebraska $1,402
Nevada $742
New Hampshire $965
New Jersey $1,174
New Mexico $996
New York $1,309
North Carolina $1,098
North Dakota $1,239
Ohio $850
Oklahoma $1,875
Oregon $659
Pennsylvania $927
Rhode Island $1,496
South Carolina $1,285
South Dakota $1,125
Tennessee $1,185
Texas $1,937
Utah $664
Vermont $898
Virginia $966
Washington $822
West Virginia $917
Wisconsin $762
Wyoming $1,120
Source: National Association of Insurance Commissioners, 2018 rates