How to Find Affordable Homeowners Insurance Rates From Quality Companies
The Cheapest Home Insurance Companies in 2021
Premium costs are some of the important factors when shopping for homeowners insurance. To help you find the best rates, MoneyGeek researched average premiums for various dwelling coverages costs and individual home insurance needs. Insurance rates vary from company to company and state to state, so it is important to compare quotes to find the best rates for your needs.
Cheap Homeowners Insurance: Which Companies Are Cheapest in 2021?
MoneyGeek collected the average home insurance premium for several national insurance companies. To ensure apples-to-apples comparisons, these rates are based on dwelling coverage of $250,000 and personal property coverage of $100,000.
In this research, MoneyGeek found that Allstate has the lowest average insurance rates based on the chosen criteria, coming in at $1,748 annually. However, it is important to note that your insurance rates could vary significantly from the average premiums listed. Insurers determine pricing for each policy based on various factors, including the location and age of your home.
Average Annual Home Insurance Costs
Cheap Homeowners Insurance in Your State
When it comes to insurance costs, location is one of the most significant factors impacting your rates. Weather events and associated issues are the cause of many home insurance claims, which means that the wildfires that ravage California each year and the hurricanes that hit Florida drive up insurance costs in those states. Weather doesn’t have to be directly responsible for damage to cause your rates to increase. For example, areas that are prone to humidity are likely to see higher rates because of potential mold damage.
One of the best ways to find cheap home insurance is to compare quotes from multiple insurance companies. The data below shows the most affordable insurance company in each state. However, please note that USAA is excluded from this data because they only provide coverage for veterans, members of the military and their families.
Cheapest by State: $100K Dwelling Coverage
Cheapest by State: $250K Dwelling Coverage
Cheapest by State: $500K Dwelling Coverage
Cheapest by State: $750K Dwelling Coverage
Cheapest by State: $1M Dwelling Coverage
Cheapest by State: $2M Dwelling Coverage
Cheapest by State: $3M Dwelling Coverage
Cheap Home Insurance by Dwelling Coverage Amount
Dwelling coverage is the portion of your insurance policy that pays to repair or rebuild your home’s physical structure in the event of a covered loss. Your dwelling coverage only includes the cost to rebuild your home, not the value of your land.
This portion of your policy has the most significant impact on your insurance rates, but that doesn’t mean you should skimp on coverage to save money. It is crucial to have enough coverage to completely replace your home in the event of a total loss. Therefore, people with more expensive homes need to have detailed records of their property features and an appraisal to ensure they do not underinsure their property.
Home Insurance by Dwelling Coverage
Cheapest Homeowners Insurance Companies With the Best Customer Service
Price is typically the biggest concern for most people looking for cheap homeowners insurance, but it isn’t the only thing you should think about. Customer support is also an essential part of finding the best home insurance because filing an insurance claim can be stressful and confusing. Having a company that understands your pain and wants to make things simple during a difficult moment is worth its weight in gold.
This is part of why so many people like buying insurance from an agent, whether that is an independent agent or an agent affiliated with a specific company. Purchasing a policy online is sometimes easier than working with an agent initially. Still, building a relationship with an agent means you have someone who knows you and your situation when it comes time to file a claim, giving you a superior customer service experience.
J.D. Power ranks each insurance company for customer satisfaction to help you find the right insurance company for your circumstances. The table below shows the companies who earned a J.D. Power ranking of four or higher for customer service.
Average Annual Rates for the Best-Rated Companies
Cheapest Home Insurance if You Have Bad Credit
Insurers often use a customer’s credit score to help determine their rates. The reasoning behind this decision is that they have found a statistical correlation between someone’s credit score and the number of claims they are likely to file. The higher your credit score, the less likely you are to file a claim.
However, some experts don’t believe this is an effective way to determine risk and even go so far as to say that this practice contributes to prejudicial practices, such as redlining. Because of this, California, Maryland and Massachusetts have all made it illegal to use credit scores when determining insurance rates.
For residents of the other 47 states, the chart below shows you the average annual rates for people with low credit scores.
Average Home Insurance Costs With Poor Credit
7 Steps to Reduce Your Homeowners Insurance Costs
Who has the cheapest homeowners insurance? There is no single answer to that question, but there are steps you can take to find the most affordable homeowners insurance for you, including:
- Compare quotes: Comparing quotes from multiple insurance companies can help you guarantee you are getting the lowest available rate.
- Shop for discounts: Every insurance company offers discounts. Some are pretty basic and widely available, such as discounts for bundling your insurance coverages, while others are more complex. For example, USAA offers a discount to members who use ADT for their home security, and Allstate offers a discount to members who use automated payment options.
- Claims-free status: Farmers, Allstate and USAA are just a few insurance companies that provide a substantial discount for members who go for 3–5 years without filing a claim.
- Increase your deductible: The higher your deductible, the lower your rates will be each year.
- Improve tour credit score: Paying your credit card bills on time can save you money on late fees, but if it helps improve your credit score, it can also reduce your homeowners insurance rates.
- Choose your home wisely: A home near a fire hydrant or the fire department is cheaper to insure. The same is true of homes that are not in a flood zone.
- Review your policy each year: Every year, you should review your policy to ensure you have the correct amount of coverage. However, you should also get quotes from other companies to make sure you are still paying the lowest possible rate.
FAQs on Comparison Shopping for Cheaper Home Insurance
Finding the best deal on your homeowners insurance can be tricky, even with all the information presented above. Many people still have questions about buying insurance, so some of the most frequently asked questions regarding shopping for affordable home insurance are listed below.