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What factors affect homeowners insurance cost?
You bought a new house and are trying to get a handle on your monthly expenses, one of the most important being your homeowners insurance. Determining the average cost of homeowners insurance depends on a wide variety of factors. For instance, did you know that owning a specific breed of dog can impact your homeowners insurance cost? Let’s take a look at some of the factors that determine how your homeowners insurance is calculated – and what you can expect.
Let’s take a look at some of the factors that determine how your homeowners insurance is calculated – and what you can expect.
Insurance and claims historyThe following are some of the factors that may be taken into account when determining your homeowners premium:
- Credit history
- Insurance score
- Gaps in coverage
- Amount of homeowners claims
- Frequency of homeowners claims
Qualities of your new house
- Age of the home – Older models may be more expensive to insure because they often aren’t updated to local building codes.
- Type of structure – The primary material used (such as brick or stone), as well as roof type (such as composite shingle or slate), are taken into consideration.
- Security and safety features – Having the latest alarm systems and smoke detectors installed could result in a lower premium. Other devices that could help reduce payments include deadbolt locks, fire extinguishers, and sprinkler systems.
The location of your home
One of the biggest impacts on your homeowners insurance cost is where you live. If you reside in an area prone to hurricanes or earthquakes, for instance, you generally will need additional coverage – which will likely impact your rate.
In addition to your region, the physical location of your house matters, too. Being close to a police or fire station are contributing factors, as well as living in a neighborhood that experiences a high number of burglaries.
Average cost of homeowners insurance by state
Average insurance rates vary by state because of factors such as population density (and associated property values) and catastrophe risk. Here are the average home insurance rates by state:
|State||Average Annual Cost|
|District of Columbia||$1,047|
States with expensive vs cheap homeowners insurance
Cheapest states to own a home
OhioOhio is the least expensive state in the country to insure a home in according to updated 2021 numbers, with an average annual premium of $895.1
MissouriLow end home values2 and a low population density3 put Missouri at the second least expensive state in the country to insure a home, with an average annual premium of $897.4
South DakotaA population density of only 167 people per square mile5 helps South Dakota clock in at the third least expensive state to insure a home, with an average annual premium of $898.6
Most expensive states to own a home
MarylandMaryland sports the highest home insurance premiums of any state in 2021, with an average annual rate of $1,212.
VirginiaThe second highest home insurance premiums are in Virginia, with average annual premiums of $1,181.
Delaware“The First State” checks in at third for most expensive states to insure a home in, with average annual rates of $1,172.7
Budgeting for the monthly cost of home insurance
Insurance is designed to save you money in the event of misfortune, but it’s still a monthly expense that must be built into your budget. Comfortably making these monthly payments entails creating a spending plan and sticking to it, ideally with the help of an expense tracking plan alongside it.8 It’s important to remember that you can take your insurance rate into your own hands, however. Improving your home security, modernizing your heating, plumbing and cooling systems, and checking for any additional discounts you may qualify for are all ways to drop your monthly home insurance rate.
Remember, dependable homeowners insurance shouldn’t have to strain your budget. There are plenty of opportunities to save, such as bundling your auto and homeowners policies. Take a look at some of the insurance discounts Nationwide has to offer.
The information included is designed for informational purposes only. It is not legal, tax, financial or any other sort of advice, nor is it a substitute for such advice. The information may not apply to your specific situation. We have tried to make sure the information is accurate, but it could be outdated or even inaccurate in parts. It is the reader’s responsibility to comply with any applicable local, state, or federal regulations. Nationwide Mutual Insurance Company, its affiliates and their employees make no warranties about the information nor guarantee of results, and they assume no liability in connection with the information provided. Nationwide, Nationwide is on your side, and the Nationwide N and Eagle are services marks of Nationwide Mutual Insurance Company. 2021 Nationwide.