The State of Home Insurance in 2023
Home insurance is in the midst of a major change that could leave millions of Americans underinsured. Premiums have risen as much as 44% in some states. Increases in home prices, materials costs and natural disasters have created a situation where many policies no longer fully cover their homes.
The changing price of home insurance
Up, down or exactly the same: depending on where you live, your home insurance premium may have changed significantly since 2022. Between 2021 and 2022, the national average rate only increased $19. But between 2022 and 2023, it went up $149 per year.
Nationwide, home insurance premiums are up 8%. Some states, however, have seen prices change by more than 30%.
Residents of states in the Midwest and South pay the most for home insurance. At over $4,000 a year, Nebraska homeowners pay the most for insurance in the nation, followed closely by Kansas, Texas and Oklahoma. Hawaii has the cheapest home insurance rate by far, just over $450 per year.
increase
North Carolina had the largest increase in home insurance premiums, at 44%.
decrease
Wisconsin experienced the largest decrease in home insurance premiums, at 8%.
| State | Average annual premium 2023 | Average annual premium 2022 | % change |
|---|---|---|---|
| Alabama | $2,179 | $2,051 | 6% |
| Alaska | $1,195 | $1,175 | 2% |
| Arizona | $1,608 | $1,397 | 15% |
| Arkansas | $2,942 | $2,447 | 20% |
| California | $972 | $934 | 4% |
| Colorado | $2,934 | $2,832 | 4% |
| Connecticut | $1,738 | $1,729 | 1% |
| Delaware | $921 | $907 | 2% |
| District of Columbia | $1,299 | $1,148 | 13% |
| Florida | $2,469 | $2,414 | 2% |
| Georgia | $1,979 | $1,875 | 6% |
| Hawaii | $458 | $412 | 11% |
| Idaho | $1,395 | $1,418 | -2% |
| Illinois | $1,834 | $1,708 | 7% |
| Indiana | $1,820 | $1,672 | 9% |
| Iowa | $1,949 | $1,909 | 2% |
| Kansas | $4,076 | $3,417 | 19% |
| Kentucky | $2,936 | $2,415 | 22% |
| Louisiana | $2,420 | $2,390 | 1% |
| Maine | $1,274 | $1,027 | 24% |
| Maryland | $1,226 | $1,171 | 5% |
| Massachusetts | $1,404 | $1,159 | 21% |
| Michigan | $2,017 | $1,547 | 30% |
| Minnesota | $2,235 | $2,008 | 11% |
| Mississippi | $2,691 | $2,912 | -8% |
| Missouri | $2,596 | $2,714 | -4% |
| Montana | $2,265 | $1,976 | 15% |
| Nebraska | $4,125 | $3,552 | 16% |
| Nevada | $1,124 | $995 | 13% |
| New Hampshire | $848 | $911 | -7% |
| New Jersey | $1,022 | $947 | 8% |
| New Mexico | $2,289 | $2,071 | 11% |
| New York | $1,189 | $1,142 | 4% |
| North Carolina | $2,597 | $1,803 | 44% |
| North Dakota | $1,979 | $1,822 | 9% |
| Ohio | $1,285 | $1,224 | 5% |
| Oklahoma | $3,748 | $3,735 | 0% |
| Oregon | $1,239 | $1,105 | 12% |
| Pennsylvania | $1,128 | $1,041 | 8% |
| Rhode Island | $1,376 | $1,236 | 11% |
| South Carolina | $2,502 | $2,493 | 0% |
| South Dakota | $2,829 | $2,377 | 19% |
| Tennessee | $2,047 | $2,079 | -2% |
| Texas | $3,884 | $3,626 | 7% |
| Utah | $995 | $926 | 7% |
| Vermont | $1,263 | $963 | 31% |
| Virginia | $1,242 | $1,268 | -2% |
| Washington | $969 | $924 | 5% |
| West Virginia | $1,717 | $1,483 | 16% |
| Wisconsin | $1,196 | $1,304 | -8% |
| Wyoming | $1,637 | $1,638 | 0% |
| Note: Average rates are based on non-binding estimates provided by Quadrant Information Services. Your rates may vary. | |||
Saving money by shopping around
Shopping around is critical when it comes to home insurance. Our team of analysts found that the average price of home insurance in a state may vary by as much as $3,667 per year. That’s because different insurance companies use a wide variety of factors when pricing insurance.
Average Annual Rate Nationwide in 2023$1,903
Click on the map below to see how your state compares
Average rates are based on non-binding estimates provided by Quadrant Information Services. Your rates may vary.
Click on the map below to see how your state compares
Average rates are based on non-binding estimates provided by Quadrant Information Services. Your rates may vary.
Most common type of home insurance claims
Home insurance protects against both property damage and liability claims, but property damage claims are much more common. Only 2% of homeowners claims are liability claims, while the other 98% are for property damage. Wind and hail is the most common type of property damage claim, followed by water damage and fire and lightning.
Wind and hail
% of claims
34%
Average cost
$10,900
Water damage
% of claims
29%
Average cost
$11,000
Fire and lightning
% of claims
25%
Average cost
$78,000
Other property damage
% of claims
7%
Average cost
$6,400
Liability
% of claims
3%
Average cost
$22,400
Theft
% of claims
1%
Average cost
$4,300
Average home insurance cost by carrier
There are about a dozen major home insurance carriers nationwide. Our team of analysts found that Erie, Chubb, USAA and Allstate are the cheapest providers, at around $1,600 per year on average. However, insurance rates depend heavily on where you live. For example, Allstate is the cheapest provider in Alabama, but the most expensive carrier in Virginia.
Most of the major carriers have gotten more expensive in the last year. The average rate from American Family increased by more than 20%, followed by 15% from Nationwide and 13% from Travelers. Allstate experienced a slight decrease in average price, at around 1%. Prices for Farmers changed little between 2022 and 2023. QuoteWizard was not able to compare rates from Erie and Farm Bureau.
Click on the graph below to see how top companies compare
Inflation and home insurance
Inflation and the rising price of homes has put many homeowners in a concerning situation. Millions of Americans could now be underinsured.
On average, it now costs around $36,000 more to rebuild your home than it did just a few years ago. Add to that the increased cost of replacing the items in your home and your existing policy may no longer fully cover the cost of rebuilding your home after a total loss. Many homeowners may now need to recalculate the amount of coverage they have for their home.
Some insurance providers offer a special type of coverage to protect you against rising prices. This “Inflation Guard” coverage automatically increases every year in order to keep up with changing construction costs. Your coverage limits will increase. But as a result, your premium will go up as well. However, the drastic rise in construction costs may have outpaced even these types of policies.
Home prices also affect the cost of home insurance. Simply put, the more expensive your home, the more expensive your home insurance. Our team of analysts found that home prices have increased 14% since 2021. Florida, Georgia and North Carolina have experienced the sharpest increases, with prices in these states going up 25% or higher.
The last two years have been tumultuous in nearly every aspect of life. This is also true for homeowners insurance. There’s no way to tell exactly how many of the nation’s 85 million homeowners are currently underinsured. In light of recent changes, however, it wouldn’t hurt to check your policy and make sure your home is fully covered.
Nationwide Average Home Price in 2023 $361,503
Click on the map below to see how your state compares
The Future of Home Insurance
From higher costs to changing coverage needs to climate change, homeowners insurance is facing a series of adjustments in 2023. First and foremost is the change in home prices. In 2023, it's expected that home prices will continue to increase, but to a lesser degree than 2022.
The surge in both home prices and materials costs means that many homeowners either need to increase their coverage limits and pay higher premiums. Nationwide, the average price of homeowners insurance is up 8%, but in states where home prices have increased the most, it’s typically higher. Home prices have risen 24% in North Carolina over the last year. The average homeowners rate in the state, meanwhile, is up over 44%. Home insurance rates will continue to rise along with home prices.
What homeowners need to cover is also changing. Millions of Americans now work from home. However, homeowners insurance policies are not generally designed to cover either working from home or home-based businesses. Most insurance plans cover around $2,500 worth of damage to business equipment, but if you need more than that, consider adding a rider or endorsement.
Inflation and Cost
The surge in both home prices and materials costs means that many homeowners either need to increase their coverage limits or are paying higher premiums. Nationwide, the average price of homeowners insurance is up 8%, but in states where home prices have increased the most, it’s up significantly more. Home prices have risen 57% in Idaho since 2020. The average homeowners policy, meanwhile, is up 34% in Idaho in the last year. Home insurance rates will continue to rise along with prices.
Work from Home
What homeowners need to get covered is also changing. Millions of Americans are now working from home. However, homeowners insurance policies are not generally designed to cover either working from home or home based businesses. Most insurance plans cover around $2,500 worth of damage to business equipment but if you need more than that, consider adding rider or extra endorsement.
Climate Change
Climate change and the rise in natural disasters are also having an impact on homeowners insurance – because most insurance policies do not cover specific types of disasters. Our team of analysts found that over the last 20 years, there has been a 163% increase in major natural disasters and a 445% increase in severe storms. There has also been an 83% increase in billion-dollar floods over the last 20 years, but floods, earthquakes and mudslides are not covered by homeowners insurance.
Climate change and more frequent natural disasters are also having an impact on homeowners insurance. Most insurance policies do not cover specific types of disasters. Our team of analysts found that over the last 20 years, there has been a 163% increase in major natural disasters and a 445% increase in severe storms. There has also been an 83% increase in billion-dollar floods over the last 20 years. However, homeowners insurance doesn't cover floods, earthquakes and mudslides.
Methodology and resources
To calculate how much the average cost of home insurance has changed in each state, QuoteWizard collected homeowners insurance quotes for a standard HO-3 homeowners insurance policy from some of the largest home insurers, including Allstate, State Farm, Travelers and Nationwide.
Our analysis used home insurance quotes from every ZIP code in all 50 states for a sample owner-occupied house built in 2000 with $275,000 of dwelling coverage. Average rates are based on non-binding estimates provided by Quadrant Information Services. Your rates may vary.
The following coverage options were used in each location:
$275,000 dwelling coverage
Coverage of your home
$27,500 other structures
The other structures on your property, like a garage
$137,500 personal property
Your belongings
$55,000 loss of use coverage
Extra living expenses if you temporarily cannot remain in your home
$100,000 liability
Legal and settlement costs if you are sued and found liable
$5,000 medical payments
Medical expenses if a guest is injured on your property
$1,000 deductible
Deductible is the amount you pay in the event of a claim
Claim prevalence and average claim cost information is sourced from the Insurance Information Institute.
The average cost of insurance for each major cost for each carrier was determined by analyzing the average price paid in each ZIP code a selected carrier is available. Prices for carriers marked N/A were not available for a direct year-to-year comparison.
Home prices were compared using Zillow pricing information between May 2021 and May 2023.
Deciding between insurance carriers can be a difficult process. QuoteWizard has resources available that can help you find out if what you're paying is inline with state averages, the factors insurance companies use to determine prices and how to decide just how much coverage you need.
Using this report
QuoteWizard is the nation’s leading insurance marketplace for people looking to quickly compare and save on a wide variety of insurance options. Feel free to share or reference the data contained within this report, with attribution to this webpage or “QuoteWizard by LendingTree”
