3.1
302 reviews
- Available discounts
- Protective devices, bundling
- AM Best Rating
- N/A
- Availability
- 23 states and Washington, D.C.
Cheapest home insurance companies
Finding the right balance between low prices and quality
By:
Bob Haegele
+1 more
Edited by:
Lauren Swift
Homeowners insurance is much more expensive than renters insurance, which costs between $14 and $30 per month. With average annual premiums of around $1,900 for homeowners insurance, you might be looking for cheaper options.
We’ve identified the cheapest home insurance companies and those with the best available features. We also considered financial strength when choosing the five cheapest home insurance companies available today.
Our top choices include established insurance companies and some lesser-known alternatives.
Jump to insightAlong with low rates, financial strength and availability are important factors.
Jump to insightHomeowners insurance rates can vary significantly depending on your home’s value and state of residence.
Jump to insightOur top 5 picks for cheap home insurance
When selecting our top choices for cheap home insurance, we focused on more than the monthly premium. Our picks offer discounts, are widely available and have a strong financial rating. No company is perfect, but these insurers have much to offer at reasonable prices.
- Lemonade
- Pacific Specialty Insurance
- Liberty Mutual Insurance
- The Hartford Homeowners Insurance
- Farmers Homeowners Insurance
3.8
90 reviews
- Available discounts
- Bundling, gated community, security systems, new home, tile roof
- AM Best Rating
- A- (Excellent)
- Availability
- All 50 states and Washington, D.C.
2.3
392 reviews
- Available discounts
- Multipolicy, claims-free, newly purchased home, new roof, insured to value, autopay, online purchase
- AM Best Rating
- A (Excellent)
- Availability
- Nationwide
3.6
143 reviews
- Available discounts
- Fire protection, retiree credits, home security system, bundling, claim-free
- AM Best Rating
- A+ (Superior)
- Availability
- Not available in Florida
2.5
442 reviews
- Available discounts
- Multipolicy, multiline, paperless, new home, protective devices, claims-free
- AM Best Rating
- A (Excellent)
- Availability
- 41 states
How much is homeowners insurance?
The cost of homeowners insurance can vary widely depending on the value of the home and where you live. For instance, a quote from Farmers shows a $500,000 home in Chicago, Illinois, would cost about $1,400 per year to insure, while a $200,000 home in Springfield, Illinois, would cost about $1,100.
Each state has different policies and laws, which can greatly affect the cost. Check several quotes to find the best rates available for your home’s value and location.
» COMPARE: Best homeowners insurance companies
Factors that impact home insurance costs
There are many factors that can affect the cost of home insurance. These are some of the key factors that affect the cost:
- Location: Different locations can vary in construction costs and extreme weather risks, affecting insurance premiums.
- Age of home and replacement cost: Older homes and those with a higher replacement cost are more expensive to insure.
- Credit score: Your premium may be lower if you have a good credit score.
- Safety features and discounts: Homes with safety features like security systems and smoke alarms are often cheaper to insure. Many insurers offer several other discounts, like bundling and new homeowner discounts.
Understanding home insurance and how it is calculated can be tricky. While giving rough estimates of home insurance costs is possible, each quote will vary depending on the insurer and how it calculates rates.
How to save on homeowners insurance
Homeowners insurance is a significant expense, but there are numerous ways to save money on your premiums. Ways to save include:
- Multipolicy discounts: Bundling home insurance with auto insurance or other policies typically means you’ll pay less than you’d pay for each policy separately.
- Home security: Increase your home safety with security systems, fire prevention and other measures for a discount.
- Increase your deductible: Some insurers will let you increase your deductible, meaning you’ll pay more out of pocket before your policy kicks in. This can be cheaper in some cases, like if you have a newer home in a safe area.
- Improve your credit: While improving your credit isn’t an overnight fix, it can lower your monthly premium.
Even if you think your policy is inexpensive, you might still be able to find a cheaper policy elsewhere. It might be worth shopping around and comparing rates to see which insurers are the most affordable.
» LEARN: How to save on homeowners insurance
What does homeowners insurance cover?
Homeowners insurance covers many things, such as damage to the home from a fire, storms, or vandalism. However, it’s important to note that flooding isn’t covered unless you have a separate flood policy. Other common coverages include personal belongings, liability and detached structures like sheds and garages.
| Is it covered? | |
|---|---|
| Structural damage | |
| Personal belongings | |
| Liability | |
| Detached structures | |
| Living expenses | |
| Floods and earthquakes | |
| Damage due to neglected maintenance | |
| High-value items | |
| Dangerous living conditions (e.g., certain dog breeds, pool) |
Lemonade Homeowners Insurance
3.1(302)
Pacific Specialty Insurance
3.8(90)
Alfa Homeowners Insurance
4.2(33)
FAQ
How does my deductible affect my insurance premiums?
Your deductible typically moves in the opposite direction as your premium. In other words, a higher deductible means a lower monthly premium, while a lower deductible means a higher premium.
Does my credit score affect my homeowners insurance rates?
While this can vary by state, your credit score typically has a significant impact on your homeowners insurance rates. However, in certain states, the use of credit scores in setting homeowners insurance premiums is prohibited.
What's the difference between actual cash value and replacement cost coverage?
Actual cash value is how much the home is worth today, including depreciation. Replacement cost is how much it would cost to replace your property, including personal belongings, without factoring in depreciation.
How often should I review my homeowners insurance policy?
Most experts recommend reviewing your homeowners policy once per year. This allows you to account for life changes like marriage or having children, as well as any market fluctuations, which can affect rates.
Bottom line
Homeowners insurance is a significant expense, but several companies offer competitive rates and great value. Our top pick for cheap homeowners insurance is Lemonade, thanks to its affordable premiums and streamlined quotes.
When choosing a homeowners insurance policy, consider rates, strong financial rates, broad availability and available discounts. To find the best choice for your home, you’ll need to consider your location, home value and specific needs.
Article sources
ConsumerAffairs writers primarily rely on government data, industry experts and original research from other reputable publications to inform their work. Specific sources for this article include:
- AM Best, “Best’s Review.” Accessed May 3, 2024.
- AM Best, “AM Best Affirms Credit Ratings of Liberty Mutual Holding Company Inc. and Its Subsidiaries.” Accessed May 3, 2024.
- AM Best, “Hartford Fire Insurance Company.” Accessed May 3, 2024.
- WFLA News Channel 8, “Slide acquires all Farmers Insurance homeowner policies in Florida.” Accessed May 3, 2024.
- National Conference of State Legislatures, “States Consider Limits on Insurers’ Use of Consumer Credit Info.” Accessed May 3, 2024.
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