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Leslie Kasperowicz
By Leslie Kasperowicz

Homeowners insurance protects your biggest investment. So what is home insurance? In addition to covering the house itself, a home insurance policy covers other structures on the property, your personal property, and provides liability protection.

Shopping for homeowners insurance is an important task, and we’ve gathered all of the best tips and information you need to make the right choice.

KEY TAKEAWAYS
  • Home insurance policies are available for renters and condo owners in addition to traditional single-family homes.
  • Comparing homeowners insurance online is fast, easy, and provides multiple quotes from top companies.
  • It’s important to ensure you get quotes for the right coverage levels to protect your home and other assets.

How to compare home insurance quotes

Shopping for home insurance can be intimidating, especially if it’s your first home. But if you follow a few simple steps, you’ll be able to quickly narrow down your choices and find the best homeowners insurance for your needs.

  • Decide how much coverage you need. This includes dwelling, liability, and personal property coverage. We’ll go into detail further down the page.
  • Request quotes with the same coverage. Make sure all of the quotes you request are apples-to-apples so that you’re comparing rates for exactly the same limits.
  • Compare the quotes and note any differences. Even if you request the same coverage levels, every company is a little different. Some might automatically include extended replacement cost coverage or added benefits like identity theft coverage. Note any extras included with the price.
  • Research the companies. A low rate isn’t the only thing to consider. Make sure you’re choosing from companies with solid ratings. Check sources like J.D. Power and A.M. Best, and review our ranking of the best homeowners insurance companies.

Best Home Insurance Companies of 2022

USAA

USAA

Our Score
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HOW WE WEIGH OUR SCORE
Customers Who Recommend
Who Plan to Renew
Customers Who Recommend
Who Plan to Renew
Value for Price
Customer Service
Claims Service
Website & Apps
State Farm

State Farm

Our Score
infoiconinfoicon
HOW WE WEIGH OUR SCORE
Customers Who Recommend
Who Plan to Renew
Customers Who Recommend
Who Plan to Renew
Value for Price
Customer Service
Claims Service
Website & Apps
American Family

American Family

Our Score
infoiconinfoicon
HOW WE WEIGH OUR SCORE
Customers Who Recommend
Who Plan to Renew
Customers Who Recommend
Who Plan to Renew
Value for Price
Customer Service
Claims Service
Website & Apps
Liberty Mutual

Liberty Mutual

Our Score
infoiconinfoicon
HOW WE WEIGH OUR SCORE
Customers Who Recommend
Who Plan to Renew
Customers Who Recommend
Who Plan to Renew
Value for Price
Customer Service
Claims Service
Website & Apps
Allstate

Allstate

Our Score
infoiconinfoicon
HOW WE WEIGH OUR SCORE
Customers Who Recommend
Who Plan to Renew
Customers Who Recommend
Who Plan to Renew
Value for Price
Customer Service
Claims Service
Website & Apps
View more best home insurance companies

How much is home insurance?

Homeowners insurance costs vary based on location, claims history, risk, and credit history. You’ll pay more for home insurance in an area with more frequent claims. That may be a region with severe weather or an area with a high crime rate.

Factors specific to your home also impact rates, including the size of the home and construction features. These things determine the replacement cost of the home. The average home insurance rate for $300,000 dwelling coverage and $300,000 liability with a $1,000 deductible is $2,779 annually.

However, home insurance rates vary by state. Homeowners in some states pay double the national average.

Oklahoma, Kansas, Nebraska, Arkansas and Texas are the most expensive states for home insurance based on an Insurance.com analysis. Among the least expensive states for home insurance are Hawaii.

Use our home insurance calculator to get an estimate of home insurance costs in your area.

Find average home insurance rates by ZIP code for common coverage levels

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CONDOINSURANCE RATES

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RENTERSINSURANCE RATES

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Average home insurance rates by state

What does home insurance cover?

Home insurance covers your home for its replacement cost (the cost to rebuild it from the ground up), other structures on the property, and your personal property. It also protects you from negligence claims with liability coverage and provides additional living expenses coverage in case you can’t live in your home during repairs on a claim.

A standard homeowners policy, or HO-3 policy, is known as an all perils policy. Some of those perils include:

  • Fire
  • Weather damage, including lightning, windstorms, hail, and the weight of ice, snow, or sleet
  • Theft
  • Vandalism
  • Water damage from sudden and accidental discharge
  • Damage from vehicles or aircraft
  • Riots
  • Explosions
  • Falling objects

Your liability and medical payments coverage will pay for injuries to others on your property and will pay to defend you in court if you are sued for negligence.

Types of homeowners insurance coverages

Dwelling Coverage

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The dwelling coverage covers the house itself. It is calculated based on the cost to replace the house at current construction prices. Some companies may include extended dwelling coverage at 125% or more of the replacement cost to cover inflation. Other structures on the property, like a shed, are covered at a percentage of the dwelling coverage, usually 10%.

Personal Property

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Personal property protection covers your possessions, such as clothing, furniture, electronics, and appliances. Coverage for your belongings is usually around 50% of the dwelling coverage. You can increase this coverage and also select replacement cost coverage rather than the depreciated actual cash value of your property.

Liability Insurance

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Liability protection covers you for bodily injury or property damage caused by you or a family member. Liability also covers legal costs and court damages if you are sued. The standard home insurance policy includes $100,000 of liability coverage, but experts recommend at least $300,000.

Valuable Items

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Standard home insurance policies usually offer limited coverage for items like jewelry. High-value items may need to be protected using what’s known as a floater or a rider. Consider a rider for any single item that has a value above the limits on your policy.

Additional Living Expenses

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Additional living expenses coverage pays for you to live somewhere else when your home is damaged by a covered peril and you can’t live there during repairs. That protection includes paying for hotel and restaurant bills and other living expenses.

Guest Medical Payments

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Guest medical covers the medical costs if a visitor to your property is hurt in a minor incident, regardless of liability. Typical limits run from $1,000 up to $5,000.

Homeowners, condo, and renters Insurance: What’s the difference?

Home insurance companies write policies specific to the needs of each type of home, including a condo or a home you’re renting. Condo and renters insurance work similarly to homeowners insurance. However, there are distinct differences between homeowners, renters, and condo insurance.

HOMEOWNER INSURANCE

Home insurance protects your house and any other structures on the property. It includes coverage for your personal belongings, liability coverage, and guest medical. Homeowners insurance protects your biggest investment and can avert financial disaster by taking on the bulk of costs if your home is damaged or destroyed.

RENTERS INSURANCE

Renters insurance covers your personal possessions. Your landlord has their own insurance policy to protect the structure but it won’t cover your belongings. If a fire damages your belongings or a thief steals your laptop and TV, your renters insurance will cover your losses, minus your deductible. Liability coverage is also included as part of a renters policy.

CONDO INSURANCE

Condo insurance covers damages within the unit (interior walls, floors and ceiling) and personal property, as well as liability claims, such as someone getting injured in your condo. Like home insurance, many perils are covered by condo insurance, such as fire, theft and vandalism. Some policies will cover your entire condo unit, but that depends on your homeowners (HOA) master policy and what it covers.

How much homeowners insurance do you need?

Before shopping for home insurance, ensure you know how much coverage you need. Take a look at the recommended coverage for each of the main components of a homeowners policy.

Once you have the coverage you need nailed down, you’re ready to compare house insurance quotes. Make sure you compare home insurance rates for the same amount of coverage from at least three different insurance companies.

5 Important things to know as you compare home insurance

  • 1You should buy enough home insurance to cover the cost of rebuilding.
  • 2Your landlord's insurance won't cover your stuff.
  • 3A good inventory is worth your time.
  • 4Replacement cost coverage is worth the extra expense.
  • 5A home or renters insurance policy doesn't cover everything.

You should buy enough home insurance to cover the cost of rebuilding.

One of the most common mistakes people make when shopping for home insurance is thinking the coverage should equal the home's market value. But home insurance is designed to pay for rebuilding your home and doesn't cover the value of the land. That amount might be lower or higher than what you paid for the house. In recent years many homeowners who lost homes in disasters were found themselves caught short because they were underinsured.

A good home insurance agent can help you estimate, and it wouldn't hurt to ask a local contractor about building costs in your area. Online calculators to estimate the replacement cost are also available through services such as HMFacts and AccuCoverage.

Your landlord's insurance won't cover your stuff.

Don't expect the landlord to help you replace anything if disaster strikes. Their insurance covers the building - not your things. Buy renters insurance to protect your belongings if they're stolen or damaged. Like home insurance, renters insurance also provides liability coverage if you're held responsible for injuries or damage.

A good inventory is worth your time.

Conduct an inventory to find out how much coverage you need. Check whether your insurance company offers an inventory app, or use the Insurance Information Institute's free online software at KnowYourStuff.org to help catalog everything. Standard home and renters insurance policies place dollar limits on valuables and special collections coverage, so you might need to buy additional coverage for those items. Besides helping you determine how much coverage you need, an inventory helps the claims process go smoothly.

Replacement cost coverage is worth the extra expense.

Replacement cost coverage is pricier than actual cash value coverage, and here's why. With replacement cost coverage, the policy reimburses you for buying a new, comparable item to replace the one that was damaged. Actual cash value coverage pays you the current market value of the item that was damaged or destroyed. Say, for instance, a pipe burst and ruined a 5-year-old couch. Replacement cost coverage would pay for a new sofa. Actual cash value coverage would reimburse you for the cost of a new sofa minus five years of depreciation.

A home or renters insurance policy doesn't cover everything.

Standard home and renters insurance policies do not cover damage from earthquakes or floods. You need to buy separate insurance policies for coverage in case either of those disasters strikes. Home and renters insurance also excludes coverage for business activities, even when the business is conducted from your home office, and limits coverage for business property.

How to save money on homeowners insurance

The most effective way to save on home insurance is to comparison shop, maintain good credit, avoid filing small claims, and get all the discounts available to you.

Compare home insurance quotes: It’s a good idea to compare homeowners insurance quotes from at least three companies. Get quotes yearly when your renewal approaches to be sure you’re getting the best deal. Rates can vary greatly from company to company and can change over time.

Maintain good credit: Homeowners with bad credit pay significantly more for coverage than those with good credit because insurance companies consider bad credit a risk factor. Stay on top of your credit report and do whatever you can to keep your score up.

Don’t file claims for minor damage: Typically, the more claims you file, the higher your insurance rate will be. Homeowners insurance is meant to protect you from big financial loss, not from minor damages. Avoid filing a claim if you can pay for the repairs yourself.

Maximize discounts: Be sure you get all of the homeowners insurance discounts for which you qualify. These may include discounts for:

Take a look at some discount details below.

I want to learn more about Home Insurance.

  • What is the cheapest home insurance?

    What you pay for coverage depends on many factors, including the age, location, and materials of your home. However, the best cheapest home insurance companies based on Insurance.com’s analysis are:

    • USAA
    • State Farm
    • Auto-Owners
    • AIG
    • Progressive
    • Allstate
    • Nationwide
    • Erie
    • American Family
    • Chubb
    • Travelers
    • Farmers

    Rates were compared for a policy with $300,000 of dwelling and liability coverage and a $1,000 deductible.

  • Is homeowners insurance required?

    Homeowners insurance isn’t required by law, but your mortgage company will require it to protect their investment in the home. If you don’t have a mortgage, you don’t have to carry home insurance, but it’s highly recommended that you do.

  • How does homeowners insurance work?

    Homeowners policies work in much the same way as car insurance. You pay a premium in return for the promise of coverage if you need to file a claim. When a claim is filed, your insurance company will investigate the claim, estimate the repair costs, and pay for damages per the policy's limits and coverage.

  • What isn’t covered by homeowners insurance?

    A standard homeowners insurance policy doesn’t cover certain types of perils, including earthquakes and floods, and also won’t cover wear and tear damage. You can buy an earthquake or flood insurance policy separately. Other common exclusions include the following, but read your policy in full, so you know what is excluded.

    • Theft or damage from a vacant dwelling
    • Damage due to war or nuclear disaster
    • Damage to pavement or foundations from ice or snow weight
    • Pests and damage done by pests
    • Defects in construction
    • Intentional acts
  • How are homeowners insurance claims paid?

    A home insurance claim goes through the same process as any claim. After the report, an adjuster will investigate and decide what’s covered. Homeowners insurance claims are usually paid by check or sometimes direct deposit. How much you get will depend on the limits of your policy, and your deductible will be subtracted from the total.

  • How do you shop for homeowners insurance?

    Shopping for homeowners insurance is similar to looking for auto insurance. You can shop online either directly with insurance companies or using a quoting tool to compare multiple companies at once. You can also work with an insurance agent to help find the right homeowners insurance for your needs.

I want to learn more about Renters Insurance

  • How much renters insurance do I need?

    You need enough coverage to replace all of your personal property. That means you’ll likely want replacement value rather than actual cash value. Replacement value pays for a brand new replacement, regardless of how old the item is. Actual cash value pays the depreciated cost of the item.

  • What does renters insurance not cover?

    Rental insurance protects your possessions, but standard policies have exclusions. That includes roommates unless they’re named on the policy, expensive jewelry and collectibles, business equipment, and flood damage. Renters insurance also doesn’t cover the structure as that’s the landlord’s responsibility.

  • Why do I need renters insurance?

    Renters insurance protects your personal property and protects you from liability claims. Your landlord’s policy doesn’t offer any protection for you at all.

  • How do I file a renters insurance claim?

    Filing a renters insurance claim is similar to homeowners and condo insurance. You’ll contact your insurance company and follow the steps for filing a claim, providing details about the type of claim and what was damaged or stolen. Most companies allow you to file a claim online, over the phone, or in person if you have an agent.

  • How much does renters insurance cost?

    The cost of renters insurance varies. The good news is that renters insurance is much cheaper than homeowners and condo insurance. The average renters insurance costs $347 annually (about $29 monthly) for $40,000 personal property and $100,000 liability protection with a $1,000 deductible.

I want to learn more about Condo Insurance

  • How is condo insurance different from homeowners insurance?

    Condo insurance is often limited to your possessions. However, depending on your HOA’s master policy, you might have to cover the floor and ceilings of your unit, too. The HOA’s master policy dictates the exact coverage needed. That’s unlike a homeowners policy, which includes the structure and your belongings.

  • How much condo insurance do I need?

    The level of condo insurance depends on your HOA’s master policy. The master policy tells how much it’s willing to cover. Often, that protection is limited to the structure and common areas. You will need to get condo insurance for your possessions and liability.

  • What does condo insurance cover?

    Condo insurance covers damages within your unit and personal property. It also handles liability claims if someone is injured in your condo. That coverage includes interior walls, floors, fixtures, and ceilings. To figure out what you need, check your condo association policy. They vary depending on protection.

    • “All in” or “all inclusive” covers the individual units’ exterior and interior surfaces. In that case, the condo owner only needs coverage for personal property and liability coverage.
    • “Special entity” covers nearly all of the condo structure. That includes fixtures. However, it doesn’t cover structural improvements or unit additions.
    • “Bare walls in” and “wall studs in” covers just the bare structure. The condo owner needs to get insurance for the contents, floors, fixtures and countertops, as well as liability.
  • How much does condo insurance cost?

    The cost of condo insurance depends on the coverage level, location, and other factors. The average condo insurance rate for a policy with $60,000 personal property coverage, $300,000 liability coverage, and a $1,000 deductible is $759 a year.

  • How do I file a condo insurance claim?

    Much like homeowners insurance, you want to notify your insurer as soon as possible after the damage. Also, contact your condo association. Depending on the damage, the association may need to file its own claim. Document the damage and take photos. Call the insurance company with your policy number and detailed information to start the claim, and follow their instructions.

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