How the States Size Up—The Best and Worst of Homeowner’s Insurance Rates

FEMA - 22840 - Photograph by Robert Kaufmann taken on 03-07-2006 in Louisiana
Homeowner’s insurance premiums can be a challenging and stressful thing. You want to protect your family and home with the best policy possible, but you also don’t want to pay premiums that will put a huge dent in your savings account. There’s a careful balance between finding the perfect policy that offers all the coverage you are hoping for and finding something that fits within your personal and home budget. Home insurance traditionally combines personal insurance protections like losses occurring to one’s home, its contents, loss of its use, or loss of other personal possessions of the homeowner, as well as liability insurance for accidents that may happen at the home. These two elements of insurance are important things to consider when examining your homeowner insurance policy needs. A big factor that plays into the premium cost of a home insurance policy is the location and potential threats a home and area face. Natural disasters are one of the primary things that homeowner’s insurance protects against, so geographic location play an important role. These are the best and worst states for homeowner’s insurance premium costs:
   

The Best

Homeowner’s insurance rates have been going up across the country now for several years. While the increase is slight in many states, the numbers are still getting larger. The top three states with the lowest home insurance premiums are Idaho, Utah, and Oregon. These three states have been in the top 10 for the cheapest premium range for many years now. Idaho residents have the cheapest average homeowner insurance rate at $367. With the national average for insurance rates at $690.62 as of December 2009, this puts Idaho almost 47 percent lower than the national average. Utah is the next lowest with an average premium rate of $399, putting the state almost 43 percent lower than the national average. While this average for Idaho’s average is down 0.5 percent, Utah’s average is up one percent, but remaining the runner up for the cheapest rates. Oregon offers the next lowest average premium rate for homeowner’s insurance at $457, which is over 33 percent below the national average. Other states that make the top 10 for the lowest premium rates are Arizona, Wisconsin, Nevada, North Carolina, Iowa, New Mexico, and Washington.

As you can see, the geographical region of the U.S in which homeowners reside does impact the home insurance premium rates. Rates in Idaho and Utah are likely lower than the premiums in California and Louisiana because the former states are less prone to natural disasters like earthquakes, floods, and hurricanes.

The Worst

It’s not hard to decipher which states in the U.S. likely have homeowner’s insurance premiums that are higher than the national average. The top three states with the most expensive home insurance premiums are Louisiana, Oklahoma, and Florida. Louisiana takes the slot for the most expensive homeowner’s insurance rates with a 41,392 annual premium, which is over 101 percent above the national average. These statistics are both astonishing and somewhat expected. With flooding and hurricanes regularly threatening residents in Louisiana, insuring a home is such a high-risk area is going to cost more. Oklahoma has the second highest premium rate at $1,009, which is just over 46 percent above the national average. Oklahoma is commonly plagued by tornados, damaging high wind situations, and hail storms, driving those insurance prices up. Florida takes the bronze spot for the most expensive home insurance premiums at an average of $964, which is almost 42 percent the national average. Like Louisiana, Florida is often threatened by flooding and hurricanes. Other states that make the top 10 list for the most expensive home insurance premiums include Mississippi, Texas, Kansas, Massachusetts, Rhode Island, Alaska, and Arkansas. It is the frequency of weather-related claims being made in these states that make residents pay above-average premiums.

While weather plays a very major role in these premium cost differences among states, it is not the only factor. Rates are higher in many of these states because the homes in many of these areas tend to have more value and are therefore more expensive to insure.

Tracy Myers is a freelance writer and blogger for www.homeinsurance.org. A nester herself, Tracy is passionate about all things home related. With her pieces, she seeks to help her readers find the best deals on home insurance and be educated consumers. You can reach Tracy in the comments below.

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Tracy Myers is a freelance writer and blogger for www.homeinsurance.org. A nester herself, Tracy is passionate about all things home related. With her pieces, she seeks to help her readers find the best deals on home insurance and be educated consumers. You can reach Tracy in the comments below.

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