Updated: May 21, 2025
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Rates updated:
Jun 09, 2025
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To get personalized home insurance estimates, input your state, credit score, age, preferred coverage level and deductible in MoneyGeek's home insurance calculator.
Based on estimates, average costs of home insurance range from $1,469 to $8,414 per year across coverage levels.
Various factors affect home insurance rates, including your coverage level, deductible amount, location, home's age and credit score.
Insurance providers consider various factors when calculating your home insurance premium, such as when and where your home was built, what environmental hazards there are, how much your home is worth and more. For instance, if you live in an area prone to wildfires, you might have to pay more for insurance. Other factors that affect your home insurance costs include:
Factor | Description |
|---|---|
Your Coverage Level | How much home insurance coverage you have plays a significant role in your costs. Getting high dwelling coverage limits or personal property limits can increase how much you pay annually. But, not having enough coverage can leave you with a significant shortfall if you suffer a loss. |
Your Deductible | A home insurance policy’s deductible is the cost you pay out of pocket before your insurer steps in to cover repairs and replacements. Increasing your deductible can lead to lower monthly rates, but it also means you need to have enough saved to pay up if you incur a covered loss. |
Your Home’s Location | Insurers consider where you live and the environmental hazards of your area. Living in an area prone to hurricanes, tornadoes and wildfires, or in an area with a higher theft rate or population density, can affect your rates. |
Your Home’s Age | Older homes typically come with higher premiums, as the cost to repair damages may be higher due to outdated materials or systems. Conversely, newer homes are often cheaper to insure due to modern building codes and systems. |
Your Credit Score | In most states, insurers will consider your credit history when setting your premium. However, in California, Hawaii, Massachusetts and Michigan, insurers are not allowed to use credit-based insurance scores as a basis to determine rates. |
Your Claims History | Having a frequent history of claims can affect your rates. Claims typically stay on file for seven years and are captured in the industry's Comprehensive Loss Underwriting Exchange (CLUE) database. CLUE also tracks claims that were filed but denied by an insurer. |
To get a quote online, in person or by phone, you’ll need to provide some basic information about yourself and your home, including:
Insurers calculate your home insurance premiums based on your dwelling coverage, personal property coverage and personal liability coverage. Dwelling coverage is the main driving factor, with $1 million in coverage costing an average of $8,414 per year, and $250K limits costing $2,635. Use the table below to see home insurance estimates for different coverage levels.
| $100K Dwelling Coverage | $ 1,469 |
| $250K Dwelling Coverage | $ 2,635 |
| $500K Dwelling Coverage | $ 4,519 |
| $750K Dwelling Coverage | $ 6,447 |
| $1MM Dwelling Coverage | $ 8,414 |
Aside from your home’s value, location is one of the most significant factors impacting home insurance coverage and costs. This is because your location has a lot to do with how insurance companies calculate potential risks. For example, if you live in an area prone to natural disasters like hurricanes or wildfires, you can expect your premiums to be higher. Similarly, if you live in an area with a high crime rate or an elevated risk of burglary or vandalism, you’ll likely end up paying more for home insurance. On the flip side, if you live in a safe area with few risk factors, your premiums will typically be lower.
Explore the table below to see the average cost of home insurance by state and dwelling coverage.
| Alabama | $ 2,781 |
Rates fluctuate because different states have varying risks and regulations. For instance, coastal states might have higher premiums due to the increased risk of hurricanes, while states in the Midwest might see elevated rates because of tornado threats and severe convective storms. The stability of a state's insurance marketplace can also lead to variations in average premiums. Some states might have a plethora of providers, fostering competitive pricing, while others might have limited options, leading to higher average costs. The local cost of living and construction can also influence repair and replacement expenses, further impacting rates.
Calculating how much home insurance you need will depend on your unique circumstances, such as the cost to replace your home, the cost of your personal belongings and even your lifestyle. You’ll also need to consider whether or not other coverages — such as flood or earthquake insurance — are appropriate.
Since dwelling coverage pays for damage to your home’s physical structure, it should be determined by the cost to rebuild your home from a total loss. For instance, if your home costs $200K to rebuild from the ground up after a disaster, your dwelling coverage should be at least $250K. Having a small buffer prevents you from overinsuring while also giving you peace of mind that your home’s repair costs will be completely covered.
If you’re not sure how much it costs to rebuild your home, here are a few ways you can do so:
Personal property coverage covers damage to all personal property and possessions inside your home. This can include everything from valuable furniture items and electronics to jewelry and more.
To determine how much personal property coverage you need, you should make a home inventory of your personal belongings and calculate what it would cost to replace them. This number is what you should aim for as a personal property coverage limit. In some cases, your insurer will automatically set your personal property coverage at 50% of your dwelling coverage.
Personal liability insurance protects homeowners from financial liabilities should they unintentionally cause harm or damage. When deciding on the amount of personal liability coverage for your home insurance, it's essential to consider various factors:
While choosing the cheapest home insurance coverage to save on premiums is tempting, ensure you're adequately protected to avoid huge financial setbacks if an unforeseen incident occurs.
While the core components of home insurance, such as personal liability and personal property coverage, are essential, homeowners might overlook additional coverages, including hazard, flood and earthquake insurance. These can be necessary depending on your situation:
Once you’ve calculated how much coverage you need, compile your personal information then collect and compare home insurance quotes amongst providers. Make sure to find a policy that fits your budget and coverage needs.
After identifying a provider, complete your application and settle your initial payment.
Comparing prices from different insurance providers can help you find the best and most affordable policy for you. MoneyGeek's homeowners insurance calculator can help you quickly estimate the cost of your insurance coverage with no personal info, whether you’re considering insurance for a property you already own or a future purchase. Before using our quote tool, determine your coverage needs.
Below are some frequently asked questions about home insurance cost estimates to help you understand how premiums are calculated.
Monthly home insurance costs typically range from about $122 to $701, depending on your coverage level. These are based on estimated annual premiums between $1,469 and $8,414, with actual rates varying by home value, location and insurer.
The main cost drivers include your coverage level, deductible, location, home's age, credit score and claims history. Insurers also consider your risk exposure, home's safety features and proximity to a fire station or hydrant when calculating premiums.
Insurers base your premium on your home’s replacement cost, not its market value. A more expensive or custom-built home typically costs more to insure because rebuilding it after a loss would require higher material and labor expenses.
Rates differ based on location-specific risks like wildfires, floods, hurricanes or crime. Areas with a higher frequency of natural disasters or theft claims often have higher premiums, even for homes of similar size and value.
Generally, you need enough home insurance to rebuild your house fully at current construction costs. That includes dwelling coverage, plus any additional protection for detached structures, personal property and liability coverage based on your financial profile.
Why Trust MoneyGeek?
MoneyGeek analyzed quotes from multiple insurance providers across the U.S. using a profile that reflects the average homeowner. By considering different locations and companies, we aim to give a reliable estimate of what homeowners can expect to pay — showing why it’s important to compare rates.
Methodology
MoneyGeek evaluated homeowners insurance carriers incorporating insights and premiums from the official databases of Quadrant Information Services.
Homeowner Profile
For our analysis, we created a sample homeowner profile with the following characteristics:
Homeowners Insurance Coverage Details
Unless otherwise specified, we used the following coverage limits to collect quotes for our comparison:
We also compiled data for policies with broader coverage to determine the best companies for insuring expensive homes, upping limits to $1 million in dwelling coverage, $500,000 in personal property coverage and $1 million in liability coverage.
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.
