is an essential part of protecting your home and its contents when the unexpected strikes. If you’re concerned about damage to your house and belongings after a covered loss occurs, your home insurance coverages can help give you peace of mind through financial protection. While it’s important to understand what your policy covers, you should also be aware of your homeowners insurance premium to help make sure you’re getting the right coverage at the right price.
What Is a Premium in Homeowners Insurance?
A homeowners insurance premium is the amount you agree to pay to an insurance company for a home insurance policy. This is different than an insurance quote, which is an estimate of your premium that’s provided by your insurer before you purchase a policy.
Are Homeowners Insurance Premiums Paid Monthly or Yearly?
If you pay your home insurance premium directly to your insurance company, typically you can pay your annual premium either in monthly payments or in-full for the year. If you have a mortgage on your home, your lender will likely require your premium to be included as part of your monthly mortgage payment. The mortgage company would then pay the full premium amount to your insurer on a yearly basis from an escrow account.
How Much Is the Average Homeowner Insurance Premium?
The average annual cost of homeowners insurance in the United States is $1,428 per year or $119 per month.2
However, homeowners insurance rates
can vary based on different factors. For example, the cost of your homeowners insurance policy may be higher or lower than the average based on your location, claims history and coverage limits.
How Are Homeowners Insurance Premiums Calculated?
Insurance companies take many factors into account when determining homeowners insurance premiums, including your:
The state you live in can affect how much you pay for home insurance. Different states
may be more prone to certain natural disasters, which could increase homeowners insurance premiums. For example, if you live in South Carolina, you may pay a higher cost than someone who lives in Idaho because the state you live in is more prone to hurricanes.
Your home’s geographic location can also have an impact on your homeowners insurance premium. If your home is located close to a large body of water, you could pay a higher cost due to having a higher risk for wind damage. If your home is located near a fire department, you may pay a lower premium because your insurer could see your home as being safer and easier to protect than other homes that aren’t located as close to a station.
Your home’s age, number of floors and square footage all influence the cost to rebuild your home after a covered loss, which may result in a higher premium. Other characteristics, like your home’s building materials and roof’s construction, can also impact homeowners insurance premiums. For example, you could save on homeowners insurance if your home is built with more disaster-resistant materials. Finally, if your home has security and safety features installed, like burglar alarms, you could be eligible for discounts that lower your premium.
Insurance companies typically pull components from your credit report and use them to build an insurance score. Depending on how high or low your score is, you could pay a higher or lower rate.
Adding more homeowners insurance coverages
to your policy could have an impact on your homeowners insurance premium based on the coverage amounts you select. Your coverage limits may also increase or decrease your premium depending on how high or low they are.
The amount you choose as your policy deductible affects your home insurance premium. Having a higher deductible can lower your premium, while selecting a lower deductible could raise your premium.
Additional factors that may affect your home insurance cost include:
- Claims history: The more claims you’ve submitted, the higher your premium may be.
- Pets: Owning a pet, like a dog, could have an impact on your homeowners insurance cost.
How Do I Pay My Home Insurance Premium?
You can pay your insurance premium directly to your homeowners insurance company or through your mortgage lender. If you pay directly, you can usually pay your bill online or by phone. If you pay through your mortgage company, they’ll likely keep your monthly payment in an escrow account with a portion of that money going to your insurer for payment.
How Can I Lower My Home Insurance Premium?
There are many ways to save on your homeowners insurance premium. To help lower your costs, consider:
- Maintaining a good claims history: Having a history of fewer claims submitted can help you keep your homeowners insurance cost down.
- Raising your deductible: Choosing a higher deductible for your home insurance policy can help lower your premium.
- Taking advantage of discounts: The AARP® Homeowners Insurance Program from The Hartford1 offers several homeowners insurance discounts to help you save on insurance. For example, you can get a discount if you install security systems at your home.
- Bundling your home and auto insurance: When you bundle your insurance, you can save on both policies. In fact, you could save up to 5% on your auto insurance and up to 20% on your homeowners, renters or condo insurance when you bundle through the AARP Auto and Home Insurance Program from The Hartford.**
Get a Homeowners Insurance Quote from The Hartford
Get the homeowners insurance coverage you need from an insurance company you can trust. The Hartford is backed by over 200 years of experience protecting homeowners and their properties. Through the AARP Homeowners Insurance Program from The Hartford, we make it easy for customers to find great coverage at a price that fits their budget. Obtenga una home insurance quote
online today or call our specialists at 877-422-2345
Última actualización: 24 de julio de 2023
2 Bankrate, “Average homeowners insurance cost in July 2023”