One of the important aspects of home ownership is insurance. Since we all want to protect our investment in our homes and are purchasers of homeowners insurance, don’t you wonder occasionally how does Texas rank in the grand scheme of housing insurance rates? In her recent article, The 10 States with the Highest Homeowners Insurance Rates, Jayleen R. Heft with Property Casualty 360 provides the list.
As we enter the busy home-buying season, you may be wondering which states have the highest homeowners insurance rates. Many factors impact home insurance premiums including real estate values, building and construction costs, vulnerability to catastrophes, as well as levels of economic growth and urbanization.
According to a January 2015 study by the National Association of Insurance Commissioners (NAIC), the average homeowners insurance premium across the United States in 2012 (the most recent complete annual data available) was $1,034. That was up 5.7% from 2011, when the increase nationwide was 7.6%.
In general, real estate values and construction costs tend to be higher in areas with higher populations. Because the amount of home insurance needed is based on the value of the home, premiums are often higher in more heavily populated places. Vacation and retirement areas, as well as areas experiencing rapid economic growth, also tend to have relatively higher real estate values.
Exposure to catastrophe impacts homeowner insurance rates
The degree of exposure to catastrophe also affects the cost of insurance to homeowners. Brush and forest fires, tornadoes, high winds, hail, freezing rain, snow storms, hurricanes, earthquakes, riots and even terrorist attacks are all types of catastrophes that can occur in the U.S. Since the late 1980s, catastrophes have been occurring with greater frequency and severity, and, in the last decade, have become an even greater consideration in the pricing of home insurance, according to the NAIC report.
Take a look at the 10 states with the highest average annual homeowners' insurance premiums on the following pages.
10. New York - Average homeowners annual premium: $1,158
9. Connecticut - Average homeowners annual premium: $1,160
8. Kansas - Average homeowners annual premium: $1,213
7. Rhode Island - Average homeowners annual premium: $1,233
6. Alabama - Average homeowners annual premium: $1,248
5. Mississippi - Average homeowners annual premium: $1,314
4. Oklahoma - Average homeowners annual premium: $1,501
3. Texas - Average homeowners annual premium: $1,551
2. Louisiana - Average homeowners annual premium: $1,742
1. Florida - Average homeowners annual premium: $2,084
Download the NAIC Report
The NAIC report includes national and state-specific premium and exposure information for non-commercial dwelling fire insurance and for homeowners insurance package policies. It also contains data descriptions and a discussion about the way certain economic, demographic and natural phenomena impact the price of homeowners insurance. For a free download of the report click on the link. http://www.naic.org/prod_serv_statistical.htm#dwelling
Questions About Saving Money?
When you have questions about homeowners insurance, we welcome your call. Some of the questions our customers ask are:
What are the types of policies available?
How do I know which policy is right for my circumstances and situation?
Will combining auto and home insurance save money?
How do I compare the rates and coverage?
Dean & Draper is a great source for the answers to your questions. And we’re only a phone call away.
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