When it comes to how much you'll pay for homeowners insurance, there's simply no single, magic number for everyone. Here's why.
The cost of a typical home insurance policy can vary significantly. According to the Federal Reserve Bureau, for instance, the average annual homeowners insurance premium is somewhere between $300 and $1,000.
Why do homeowners insurance rates vary so much? Well, for starters, insurers consider a number of factors when determining the amount people pay for a policy, including the location and age of a house. The cost of your specific homeowners insurance could also depend on the types of coverage you select.
Here, we break down how these specific factors can impact how much a homeowners insurance policy costs.
the cost of rebuilding your home
If it would take $250,000 to rebuild your house after a catastrophe, your insurance costs may be higher for sufficient coverage to financially protect your investment than someone whose rebuilding cost is half as much (all else being equal).
Dwelling coverage on your homeowners policy can help pay to repair your house after it's damaged by a covered loss like a fire or windstorm — so always choose limits high enough to cover the cost of rebuilding your home. Coverage is subject to the terms and limitations in your particular policy.
Don't forget about your personal property
Should a storm send a tree branch through your living room, for example, you're going to want enough personal property insurance to fully replace any destroyed belongings (like furniture, clothing, electronics, and more). Creating a home inventory can help you calculate your personal property coverage limits and, ultimately, how much homeowners insurance you choose.
the deductibles you choose
Another reason why the average cost of homeowners insurance can vary by hundreds of dollars from one person to the next are homeowners insurance deductibles.
A policy with high deductibles may generally have lower annual premiums since you're choosing to pay more out of your own wallet if you need to make a claim. On the other hand, policies with lower deductibles may typically have higher annual premiums, but those policyholders won't have to shell out as much cash in the event of a claim.
With Esurance's all-peril deductible, you can conveniently choose one amount (between $1,000 and 5 percent of your dwelling coverage limit) and that's all you'll have to pay in most covered events. There are exceptions, such as wind and hail, which you'll often choose separate deductibles for.
your claim history
Virtually every home insurer will take a look at your claim history in order to help determine your premium and how much you may pay on your home insurance premium per month. A person who's filed more homeowners insurance claims may be deemed a higher risk and could pay a higher premium than a person who hasn't filed as many claims.
Remember, it's a good idea to avoid any lapses in homeowners insurance, since people who maintain continuous coverage may generally be seen as lower risk than those who don't. Not only do you benefit from the peace of mind that consistent financial protection for your home can provide, but it could also save you some cash in the long run.
where you live and the age of your house
Do you live on a floodplain or in a more temperate area? What about a high-crime neighborhood versus a more peaceful one? You can see why these things would matter to your home insurer — as one locale may pose a much greater financial risk to the company than another. That's why your home's location can often affect your homeowners insurance premium.
The age of your house matters too. From old-fashioned wiring and plumbing, to outdated roofing materials, to structural integrity, and more — homeowners insurance for an older home can sometimes cost more.
But by maintaining your home well and doing necessary renovations and upgrades, you could help bring the cost of your homeowners premium down. By installing hail-resistant roof material, or even things as simple as smoke alarms and fire sprinkler systems, you could score homeowners insurance discounts that help you keep more cash in your wallet.
Owning a dog
Home insurers often have restrictions on certain types of dogs, but all breeds can affect how much you pay for homeowners coverage since all breeds pose at least some risk of biting someone or tearing up your place, for example.
It's a good idea to speak with a licensed agent to see how pets affect your homeowners insurance, if at all.
Having a pool or trampoline
Even though a pool or trampoline may look like ideal backyard recreation to you, your homeowners insurance company may feel differently. These "attractive nuisances" pose potential safety risks to both you and your loved ones, as well as guests.
Taking safety precautions like putting a fence around your pool or safety net around your trampoline (assuming they're not already required by state or local regulations) could help bring your premium down (or, at the very least, help to prevent accidents).
see how much you could start saving today with reliable homeowners insurance from esurance
On top of already-affordable rates, Esurance offers a bevy of discounts on home insurance to help you save money on reliable coverage. Plus, with a wide array of coverage options, an A+ rating from A.M. Best*, and proud membership of the Allstate family of companies, what's not to love about Esurance? Get your homeowners insurance quote online, or give our agents a call at 1-866-439-5633.
How homeowners insurance premiums are decided
Learn about even more factors that are taken into consideration when home insurers calculate your premium.
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