The best and most affordable home insurance for people with bad credit is AIG, earning a MoneyGeek score of 4.77 out of 5 and an average rate of $144 per month for $250,000 in dwelling coverage. For military members, veterans and their family members, USAA is the best with a 4.82 score and rate of $305.
Home Insurance for People with Bad Credit
Updated: September 1, 2026
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Key Takeaways
Home insurance costs 105% more for those with bad credit compared to those with good credit, averaging $595 monthly.
The cheapest and best home insurance for bad credit homeowners is AIG, with rates averaging $144 per month for $250,000 in dwelling coverage.
Home insurance providers do not use credit scores to determine rates in California, Massachusetts and Hawaii, as they are legally prohibited from doing so.
10 Best Homeowners Insurance for Bad Credit
| USAA | $305 | $3,660 | 4.82 |
| AIG Insurance | $144 | $1,728 | 4.76 |
| Amica | $230 | $2,755 | 4.69 |
| State Farm | $295 | $3,545 | 4.51 |
| AAA | $267 | $3,205 | 4.5 |
| Chubb | $737 | $8,850 | 4.4 |
| CSAA | $401 | $4,808 | 4.39 |
| Farmers | $458 | $5,497 | 4.28 |
| Allstate | $382 | $4,584 | 4.26 |
| Homesite | $373 | $4,479 | 4.18 |
When we pulled AIG's rates across every credit tier, the penalty it charges for bad credit is surprisingly small. Homeowners with poor credit pay $144 a month. Those with excellent credit pay $63, an $81 difference. Most carriers treat a poor credit score as a reason to nearly double your premium. AIG is the exception: even at its most expensive, it's still cheaper than what Amica charges someone with excellent credit ($80 a month).
How Much Does Home Insurance Cost For Your Credit Score?
Your credit score affects your home insurance rate more than you'd think. We found that the same $250,000 dwelling policy ranges from $63 a month with excellent credit to $144 a month with poor credit, and that's just with one insurer. Select your dwelling coverage amount and credit score in the calculator below to see what you'd actually pay across every carrier we analyzed.
Get Home Insurance Rates by Coverage and Credit Score
See the average rates based on your limits and credit score.
Rates use a profile of 41 to 60-year-old homeowners with no prior claims insuring a 2,500-square-foot home with a $1,000 deductible.
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CREDIT ISN'T THE ONLY FACTOR IN HOME INSURANCE RATES
Credit is one of several factors that affect home insurance rates. Additional elements that influence premiums include:
- Age of the home and appliances
- Safety features
- Type of construction
- Coverage requirements
- Age of the policyholder
- Claims history
Bad Credit and Home Insurance: Why Bad Credit Affects Your Premiums
In most states, insurers use your credit-based insurance (CBI) score to determine your home insurance rates. If you have bad credit, you may pay more for coverage. For example, the average annual cost of home insurance is $3,467 for a policy with $250,000 in dwelling coverage, while someone with bad credit pays about $7,136, or 105% more.
Insurers often see homeowners with poor credit as higher risk because credit history can hint at how likely someone is to file a claim. Instead of denying coverage, they tend to raise premiums to offset that risk. See how rates can change based on your credit score for $250,000 in dwelling coverage below:
| Excellent | $179 | $2,151 |
| Good | $289 | $3,467 |
| Fair | $296 | $3,552 |
| Below Fair | $394 | $4,728 |
| Poor | $595 | $7,136 |
NOT ALL STATES ALLOW THE USAGE OF CREDIT SCORES
California, Hawaii, Massachusetts and Michigan prohibit home insurers from using credit-based insurance (CBI) scores in premium calculations.
How Do Home Insurance Companies Determine Your Credit-Based Insurance Score?
Insurers run a soft credit check at application, pulling the applicant's credit report to calculate an individual credit-based insurance (CBI) score. CBI formulas are proprietary and vary by insurance company, though several known factors influence the result.
Factors that can produce a high (good) CBI score are:
- Low credit utilization rate
- Consistent payment history with no late payments
- Diverse mix of credit accounts in good standing
- Established credit history spanning multiple years
Your CBI score drops when you have:
- Outstanding accounts in collections
- History of late or missed payments
- Credit cards at or near their limit
- Excessive recent credit applications
CREDIT-BASED INSURANCE SCORE (CBI) VS. FICO SCORE
CBI scores and FICO scores both pull from your credit report. FICO scores measure creditworthiness for lenders. CBI scores predict how likely you are to file insurance claims.
Because many of the same factors determine FICO and CBI scores, a low FICO score often means you'll have a low CBI score, and vice versa.
How to Get Cheap Homeowners Insurance With Bad Credit
Homeowners insurance costs can be reduced even with a low credit score. Seven steps make it possible:
- 1Get Multiple Quotes to Compare
Each insurer calculates premiums differently, so rates for the same home vary by provider. Pulling quotes from at least three insurers before selecting a policy produces the most useful comparison.
- 2Use Bundling and Other Discounts
Combining home and auto insurance with a single provider reduces both premiums. Confirming available discounts with each insurer before selecting a policy helps identify additional savings opportunities.
- 3Compare Deductibles
A higher deductible produces a lower premium. Before selecting a deductible level, confirming it can be covered out of pocket at claim time is essential.
- 4Make Home Changes
Home security systems, fire alarms and updated HVAC systems are among the upgrades that qualify for premium discounts with most insurers.
- 5Check Your Coverage
Annual coverage limit reviews help ensure premiums reflect actual protection needs rather than inflated or outdated amounts.
- 6Limit Filing Claims
Frequent small claims push premiums higher and can trigger policy cancellation by the insurer.
- 7Improve Your Credit
Debt reduction, consistent on-time payments and fewer new credit applications strengthen the credit score over time and can translate directly into lower home insurance premiums.
Getting Homeowners Insurance With Bad Credit: Bottom Line
Your credit score is just one factor that determines insurance rates, along with claims history, home age, appliances and other criteria. MoneyGeek examined how to find the cheapest homeowners insurance for people with low credit scores and how to get coverage without a credit check.
While AIG offers the best and lowest average premium at $144 a month for bad credit, the best homeowners insurance for you may differ depending on your location and profile, and if you're eligible, USAA's combination of the highest MoneyGeek score (4.82) and strong coverage makes it worth checking first.
Bad Credit Home Insurance: FAQ
We answered common questions about getting homeowners insurance with bad credit to help you find affordable coverage.
Most homeowners insurance companies use credit to determine premiums. If you live outside California, Michigan, Massachusetts and Hawaii, your insurance company will likely factor your credit score into your rate.
Insurance companies or agents usually check your credit score before giving you a quote. Your credit-based insurance score may not be factored in for online quotes until your premium is finalized.
Because it's a soft credit inquiry, your home insurance credit check doesn't impact your credit score, no matter how many quotes you get.
You can get home insurance without a credit check, but it's only guaranteed in California, Hawaii, Massachusetts and Michigan. Finding companies that skip credit checks in other states is difficult.
While getting a quote without a credit check is challenging, insurers rarely deny coverage because of poor credit. However, expect much higher rates if your credit score is low.
Best Home Insurance Rates for People With Bad Credit: Our Ratings Methodology
MoneyGeek analyzed homeowners insurance quotes from multiple providers across the U.S., using data from Quadrant Information Services' official databases. We compared rates for homeowners with poor credit (300 to 579) against homeowners with good credit (769 to 792), using a single sample profile: a wood-frame home built in 2000 with a composite shingle roof, $250,000 dwelling coverage, $125,000 personal property coverage, $200,000 liability coverage and a $1,000 deductible.
The comparison shows the real cost difference bad credit creates across locations and credit tiers. It also helps homeowners with poor credit identify insurers offering the most competitive rates despite credit challenges.
Home Insurance With Bad Credit: Related Pages
About Mark Fitzpatrick
Mark Fitzpatrick is a licensed Property and Casualty (P&C) Insurance Producer in Connecticut and MoneyGeek's resident expert in insurance and economics. In nearly a decade covering the insurance market at LendingTree and MoneyGeek, he's analyzed hundreds of carriers and millions of rates across auto, home, renters, health and life insurance.
His work has appeared in The Washington Post, The New York Times and NPR. He draws on independent cost and consumer experience data, and no insurance company partnerships affect his recommendations.
Mark studied at Boston College and later earned a master's in economics and international relations from Johns Hopkins University. He worked in financial risk management at State Street before joining MoneyGeek. He's also a five-time “Jeopardy!” champion.
Sources
- Experian. "What Is the Difference Between Credit-Based Insurance Scores and Credit Scores?." Accessed May 16, 2025.
- Insurance Information Institute. "Background on: Credit Scoring." Accessed May 16, 2025.