Homeowners Insurance Facts and Statistics

According to the Insurance Information Institute, 88% of homeowners have an active insurance policy to protect their property as of 2023, with 32% reporting weather-related impacts in the past five years. However, premiums have risen, with an almost 8% increase in 2021 from 2020, according to the National Association of Insurance Commissioners.

Claims have also increased, with 5% of insured homes filing in 2022 and the average claim cost reaching $18,311, the highest in five years. Property damage remains the top reason for claims, with wind and hail as leading causes.

Purchasing homeowners insurance ensures coverage for your most valuable asset, even if it’s not legally required. By understanding homeowners insurance statistics, you can learn how valuable coverage can be for any homeowner.

Losses in homeowners insurance are typically measured in two ways: the average number of claims filed per 100 policies (claim frequency) and the average amount paid for each claim (claim severity). In 2022, 5% of insured homes filed a claim, slightly higher than in 2021 but still below the five-year average of nearly 6% from 2018 to 2022.

Claim severity increased to $18,311 in 2022, up from $16,801 in 2021. This figure also surpassed the five-year average claim severity of $15,749. As both claim costs and frequency rise, homeowners may experience higher premiums as insurers adjust rates to cover increased losses.

Source: Insurance Information Institute

Property damage was the most common cause of homeowners insurance claims in 2022, accounting for 98% of all losses. Within this category, wind and hail were the leading causes, making up 41% of property damage claims. Water damage and freezing followed at 28%, while fire and lightning represented 22%. Theft and other types of property damage contributed minimally.

Liability claims — such as those for bodily injury and property damage to others — were far less common, representing only 2% of total losses. Medical payments and other minor claim categories made up the remaining fraction.

Source: Insurance Information Institute

Property damage claims surpass the combined expenses of all liability claims. Fire and lightning are the most expensive, averaging $83,991 per claim. Liability claims involving credit card fraud and other property damage come next, averaging $34,183 per claim, followed by bodily injury and property damage claims at approximately $31,690. Although water, wind and hail damage and medical payments have lower average costs, they can still result in significant expenses. Theft claims are the least costly, averaging $5,024 per claim.

Source: Insurance Information Institute

Homeowners pick from several types of home insurance policies, called "forms." Eight primary policy types exist, with the right one depending on your home's structure and desired coverage level. HO-1, HO-2, HO-3, HO-5 and HO-8 policies cover single-family homes and other housing units. The HO-4 policy (renters insurance) and HO-6 policy (condo/co-op insurance) serve tenants and condo owners.

The HO-3 policy ("special form") dominated homeowners insurance in 2021, accounting for 78% of owner-occupied policies. HO-3 policies deliver comprehensive home coverage at lower costs than other types.

HO-5 policies came next at 13%, offering broader coverage at higher prices. HO-2 policies made up 7%, HO-1 captured 2%, and HO-8 policies registered under 1%.

Among renters and condo owners, 75% carry HO-4 policies while 25% hold HO-6 coverage. HO-4 policies protect tenants' personal property and liability without covering structural damage (the landlord's responsibility). HO-6 policies cover personal belongings plus resident-owned unit components (interior walls, fixtures).

The average cost of homeowners insurance varies widely by state and is influenced by factors such as the frequency of natural disasters, crime rates and other local risks. According to the latest report, the national average is $1,411. Florida has the highest average annual premium at $2,437, while Wisconsin has the lowest at $780.

Explore your state’s average homeowners insurance costs in the map below.

Source: Insurance Information Institute

Certain states have higher homeowners insurance rates than others, as location plays a significant role in determining premiums. Factors such as the age of the area, proximity to other buildings, the availability of fire services, crime rates and government regulations can all impact premium costs. The greater the perceived risk of claims in your area, the higher your premiums will be.

Below are the top five states with the most expensive homeowners insurance premiums:

In some states, homeowners insurance is more affordable due to a lower likelihood of filing claims. Factors such as reduced crime rates or minimal risk of natural disasters contribute to these lower premiums.

The states with the most affordable homeowners insurance premiums are detailed below:

Direct premiums earned represent the total amount policyholders paid for homeowners insurance. State Farm led the homeowners insurance market in 2023, writing $27 billion in direct premiums and holding an 18% market share. Allstate and Liberty Mutual followed, with $13.6 billion and $10.5 billion in direct premiums, respectively. These companies, along with USAA and Farmers Insurance, form the top five providers, covering a significant portion of homeowners nationwide.

Considering market share can be helpful when selecting the best homeowners insurance provider. Larger companies often offer more benefits and convenience, while smaller providers may have more competitive premiums. Reviewing a company’s financial health can also provide valuable insight into its reliability and ability to support claims. Explore more about homeowners insurance companies by examining their market share and related statistics in the table below.

Check these frequently asked questions about homeowners insurance statistics and policy details:

Homeowners insurance involves more than statistics. Learn more in these resources:

1. Best Homeowners Insurance Companies: Explore the top providers for homeowners insurance and what makes them stand out.
2. Compare Home Insurance Quotes: Find out how to compare quotes to get the best value and coverage for your home insurance needs.
3. FAQ About Homeowners Insurance: Answers to frequently asked questions about homeowners insurance, providing clarity on common concerns.
4. Home Insurance Calculator: Use this tool to estimate your potential home insurance costs based on various factors.
5. How Much Home Insurance Coverage Do You Need to Protect Your Home?: Find out how much coverage is best for you and your home.
6. How to Buy Homeowners Insurance: Everything You Need to Know: Learn the basics to ensure you get the home coverage you need.
7. Standard Homeowners Insurance Coverages Explained: Dive deeper into the different types of homeowners insurance coverages to understand what each includes and how they protect you.
8. The Cheapest Home Insurance Companies: Discover affordable homeowners insurance options without compromising on coverage.
9. Understanding Homeowners Insurance Coverage A, B, C, D, E and F: A breakdown of the different parts of homeowners insurance policies and what they cover.
10. What Does Homeowners Insurance Cover?: Learn about the range of incidents and perils typically covered under a homeowners insurance policy.