Home insurance in New Mexico costs about $149 monthly or $1,786 annually on average. Residents pay $71 less per month or $849 less annually than the national average, making it the 20th most affordable state for home insurance.
Average Home Insurance Cost in New Mexico
Updated: June 2, 2025
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Rates updated:
Jun 06, 2025
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Key Takeaways
Depending on your financial history, home details and other personal information, home insurance costs in New Mexico can range from $801 to over $13,604.
New Mexico's home insurance premiums are the 20th most affordable in the country, at 32% below the national average.
To find the best home insurance in New Mexico, determine what coverage you need beforehand, research costs and discounts in your area, and shop around.
How Much Is Home Insurance in New Mexico?
| New Mexico Average | $149 | $1,786 | -32% |
| National Average | $220 | $2,635 | 0% |
*These rates represent a home built in 2000 out of frame with $250,000 Dwelling, $125,000 Personal Property and $200K,000 Liability coverage with a $1,000 deductible.
Why Is Home Insurance So Expensive in New Mexico?
Home insurance is expensive in New Mexico mainly because of the increasing number of claims, the high risk of severe weather and natural disasters, rising material and labor costs, and state insurance laws. Below, we explain each factor in detail:
Rising Claims
Insurance companies raise rates when they see more claims because they expect to pay out more money in the future. If your area has frequent claims, insurers view it as riskier and charge higher premiums to protect themselves from bigger losses.
High Weather Risks
Areas prone to severe weather, such as hurricanes or wildfires, face higher home insurance rates. Insurers adjust premiums upward to account for the increased likelihood of costly damage and claims.
Rising Material and Labor Costs
When the cost to repair or rebuild homes goes up due to pricier materials or labor, insurance companies raise premiums to ensure they can cover these higher expenses in the event of a claim.
State Insurance Laws
New Mexico regulations can affect insurance costs. Mandates on coverage minimums or rate-setting processes can lead to higher premiums if they increase the insurer's costs or required reserves.
What Affects New Mexico Home Insurance Costs?
For most home insurance companies, pricing is influenced by factors like:
- Coverage chosen
- Home build details
- Provider chosen
- Credit
- Claims history
Next, we'll explore how these factors impact rates in New Mexico.
How Much Does Coverage Affect Home Insurance Costs?
Coverage choice is the most influential factor in New Mexico home insurance rates, with costs ranging from $715 to $6,942 per year. Higher coverage limits and lower deductibles increase premiums, while lower limits and higher deductibles reduce costs.
| Lowest | $100K Dwelling / $50K Personal Property / $100K Liability | 2000 | $60 | $715 |
| Highest | $1MM Dwelling / $500K Personal Property / $1MM Liability | 500 | $578 | $6,942 |
How Much Do Home Details Affect Home Insurance Costs?
Home details like age, construction materials and roof type are the second most influential factor in New Mexico homeowners insurance rates, with costs ranging from $79 to $169 per month. These factors affect replacement costs and the risk of damage or theft, leading to rate differences.
| Lowest | New | Superior | Composition | $79 | $946 |
| Lowest | New | Superior | Tile | $79 | $946 |
| Highest | Old | Frame | Shake-Treated | $169 | $2,030 |
How Much Does the Provider You Choose Affect Home Insurance Costs?
Your choice of insurer is the third most influential factor in New Mexico home insurance rates, with prices ranging from 16% below to 16% above the state average.
| Lowest | State Farm | $125 | $1,501 |
| Highest | Foremost Insurance | $173 | $2,071 |
How Much Does Credit Affect Home Insurance Costs?
A higher credit score makes you appear more reliable, which can lower your home insurance costs. Premiums vary by up to 65%, with annual average rates ranging from $1,263 to $4,225.
| Lowest | Excellent | $105 | $1,263 |
| Highest | Poor | $352 | $4,225 |
How Much Does Claims History Affect Home Insurance Costs?
Filing more claims will increase your perceived risk for insurers, which can increase premiums. However, in New Mexico, claims history has a smaller impact on cost than other factors. We found that depending on your claims history, rates can be affected by up to 13% or $276 annually.
| Lowest | Claim free for 5+ years | $149 | $1,786 |
| Highest | 2 claims in past 5 years | $198 | $2,375 |
Tips to Save on New Mexico Home Insurance
With home insurance costs rising in New Mexico, finding ways to save is important, whether you're buying a new home or cutting current costs. Below are tips to secure the best and cheapest home insurance in New Mexico tailored to your needs.
- 1
Find How Much Coverage You Need Beforehand
Determining how much home insurance you need before buying allows you to focus your search for coverage and avoid being oversold by agents. In addition to standard coverage options, consider if you need add-ons to protect any additional items you own.
- 2
Research Costs and Discounts Beforehand
To determine if you’re getting a good deal, understand the average costs for you and your home. Also, ask agents about all available home insurance discounts, as some insurers apply certain reductions only if requested.
- 3
Compare Multiple Providers Through Different Avenues
Compare multiple insurers apples to apples to find the best coverage for your needs. Use various methods, including online comparison sites, brokers, provider websites, and agents, as quotes vary significantly across these channels.
- 4
Consider Bundling Policies
Bundling policies can lead to significant savings. For example, combining home and auto insurance in New Mexico can help you save considerably on both policies.
- 5
Reduce Your Personal Risk Profile
To get cheaper premiums, consider making improvements like adding storm shutters or home security systems. Also, improving your credit score can decrease premiums significantly. For example, moving from a fair to a good credit score can save you 28% on average.
- 6
See if You Are Eligible for State Programs
If you're denied traditional home insurance coverage, explore New Mexico programs that can help you get affordable coverage. While these programs don’t offer the same coverage amount as traditional policies, they meet mortgage requirements.
New Mexico Home Insurance Calculator: Bottom Line
Home insurance costs vary, mainly by coverage choice and home details. Find affordable rates by identifying your needs and options, then use our tool to compare.
Homeowners Calculator Insurance New Mexico: FAQ
Homeowners insurance costs in New Mexico depend on several factors. To help you estimate expenses, MoneyGeek answers common questions about home insurance in the state.
How much does homeowners insurance cost in New Mexico?
New Mexico's average monthly home insurance cost is $149 for dwelling coverage of $250,000. However, your rate will depend on factors like your credit score, liability and property coverage limits, and deductible.
How do I know how much dwelling coverage to get?
Homeowners can estimate their required dwelling coverage by calculating the cost to replace their home after damage, often with help from an appraiser. While this study uses a baseline coverage of $250,000, you can use the MoneyGeek homeowners insurance calculator to find the best coverage limit for your needs.
What factors affect home insurance costs the most?
The biggest factors affecting home insurance costs are your chosen coverage level and provider. Your credit score and home details also influence your rates.
How We Determined Our New Mexico Home Insurance Estimates
When determining the average cost of home insurance in New Mexico, we used a base profile for a simple estimate consistent with the following:
- $250,000 dwelling coverage
- $125,000 personal property coverage
- $200,000 liability coverage
- Home Built Year: 2000
- Construction type: Frame
- Roof type: Composition
- $1,000 deductible
- No claims in the past 5+ years
- Fire protection level of 3
However, rates will vary widely depending on factors such as coverage level, provider chosen, the age of the home, other features of the home, insured credit and claims history, among other factors. All other combinations presented in this article assume the home was built in 2000.
About Mark Fitzpatrick
Mark Fitzpatrick, a Licensed Property and Casualty Insurance Producer, is MoneyGeek's resident Personal Finance Expert. With over five years of experience analyzing the insurance market, he conducts original research and creates tailored content for all types of buyers. His insights have been featured in publications like CNBC, NBC News and Mashable.
Fitzpatrick holds a master’s degree in economics and international relations from Johns Hopkins University and a bachelor’s degree from Boston College. He's also a five-time Jeopardy champion!
Passionate about economics and insurance, he aims to promote transparency in financial topics and empower others to make confident money decisions.