Cheapest homeowners insurance in 2024 | Bankrate (2024)

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Compare the cheapest home insurance companies

Based on our research, Erie and USAA offer the cheapest average home insurance rates in the U.S. Erie is a regional insurer available in 12 states and Washington, D.C., while USAA exclusively serves active-duty military, veterans and their qualified family members. If neither company is an option for you, you might want to get homeowners insurance quotes from the other options on our list: Auto-Owners, Nationwide, Travelers and Allstate.

In the tables below, you’ll find the average premiums for these six cheap home insurance companies to help get you started on your shopping journey.

Home insurance rates are known to fluctuate frequently, but you can rely on Bankrate to offer you the latest options available.

How Bankrate picked the cheapest homeowners insurance companies

To find the cheapest home insurance companies, Bankrate’s insurance editorial team started by obtaining April 2024 premium information for the largest homeowners insurance companies by market share from Quadrant Information Services. Because we know that many people want to find not just the cheapest, but the best home insurance, we also used J.D. Power customer satisfaction scores and AM Best financial strength ratings in our research. Our analysis method allowed us to identify our top picks for the cheapest home insurance companies on the market. To qualify for ranking on this list, the companies had to meet these criteria:

• Have an average annual premium below the national average for $300,000 in dwelling coverage
• Have a Bankrate Score of 3.0 or higher
• Have an AM Best financial strength rating of A+ (Superior) or higher
• Be ranked in the 2023 J.D. Power U.S. Home Insurance Study

A good choice for first-time homebuyers on a strict budget

A good option for military-focused coverage

A good option for flexible coverage

A good choice for consolidating insurance and banking products

A good choice for customizable coverage

A good choice for policy management options

Cheapest homeowners insurance companies for different homeowners

Not all homeowners have the same rating metrics, and home insurance rates vary widely based on your individual circ*mstances. To help you understand what your average rate might be, we’ve isolated the cheapest companies based on several underlying rating factors.

Cheapest home insurance companies by state

State-specific factors, such as the likelihood of natural disasters and the rising cost of building materials, can affect your home insurance premiums. For example, in states like Florida and Louisiana, where widespread wind damage from hurricanes is more likely, average home insurance rates are often higher than they would be in lower-risk areas.

Through our research, we determined the provider that has the cheapest home insurance rates in each state. According to our research, USAA was the cheapest homeowners insurance company in many states, but note that it only writes policies for active and retired military members and their families, so not everyone will qualify for coverage. Fortunately, many other carriers also offer competitive average rates.

Cheapest companies for homeowners insurance in each state

Home insurance rates are known to fluctuate frequently, but you can rely on Bankrate to offer you the latest options available.

Home insurance rates are known to fluctuate frequently, but you can rely on Bankrate to offer you the latest options available.

Although home insurance isn't legally required, your mortgage lender will probably require you to maintain a policy. Purchasing home insurance is considered wise even when you own your home free and clear — it can offer financial protection if your home is damaged or destroyed in a covered incident. You can take steps to find the most affordable home insurance policy that fits your needs and provides you with financial peace of mind.

• Evaluate your needs: Every homeowner has unique insurance needs, and it’s important that you identify what’s important to you before you begin shopping. If you’re a tech-savvy homeowner, you might prefer to manage your policy online or through an app. Or, perhaps price is your primary consideration, and you need a company that offers low rates and a plethora of discounts. Narrowing down what you need from your insurance policy can help you shop more efficiently.
• Consider state-specific coverage types: Insurance needs vary greatly by state based on regional weather patterns and risk factors. If you live along a fault line, you might consider purchasing an earthquake insurance policy. Or, if your home is in a Federal Emergency Management Agency-designated flood zone, a flood insurance policy may be a wise purchase. While these add-ons will cost you more upfront, they may save you thousands in out-of-pocket expenses should you experience a covered disaster.
• Determine your home’s replacement cost: The cost to rebuild your home may not equal what you paid for it. Your home’s rebuild cost influences your dwelling coverage limit, which is often used to calculate limits for your other coverage types. Online replacement cost estimators can give you some insight, but an insurance professional can help you estimate your replacement cost with their insurance company's valuation tool.
• Consider your liability exposure: If you have $250,000 in dwelling coverage, your policy may have your liability coverage at $300,000. However, $300K may always not be enough. If you have an attractive nuisance on your property, like a trampoline or a swimming pool, you might want to raise your liability coverage or purchase a separate umbrella policy. This may also be the case if you frequently host guests in your home. While a higher liability limit will raise your overall premium, it may provide valuable financial protection if you’re hit with a lawsuit.
• Shop around: Every insurance company weighs risks differently, and some companies offer more coverage options and discounts than others. Requesting quotes for coverage types and limits that are as similar as possible can help show you where you might find the lowest rates. Another factor to be aware of when shopping is that insurance companies typically calculate their own dwelling coverage limit for your home, so this figure may vary between carriers.
• Utilize discounts: Most insurance companies offer a variety of home insurance discounts to help you save. Common discounts include multi-policy, home safety features, loyalty, new homebuyer and claims-free.
• Meet or exceed your mortgage requirements: Most mortgage companies require policyholders to carry enough dwelling coverage to either rebuild the home after a loss or pay off their loan in full. Homeowners who cannot or will not carry the required limits may have a lender-placed policy forced onto their mortgage payments or have their homes put in foreclosure. This type of policy typically costs more than owner-purchased coverage.
• Improve or maintain your credit score: Aside from a few states where it is prohibited, most home insurers use your credit-based insurance score as a rating factor. According to the Triple-I, homeowners with lower credit are statistically more likely to file claims, so insurance companies charge higher premiums to compensate for this increased risk. Improving a low score or maintaining a good credit score might help you keep your home premium lower.

Once you have selected your insurance carrier, you must complete and sign an application. You must also make at least a first month’s payment to start the policy unless your mortgage is escrowed. With an escrow mortgage account, your insurance company will bill your mortgage lender for the full annual premium each year.

Your personal rating factors and your home's characteristics influence what you pay for home insurance. Below are some key factors that affect your cost of home coverage.

• Claims history: Insurance claims generally increase your premium, so the fewer claims you’ve filed over the years, the less likely you are to see rate surcharges or have your policy nonrenewed.
• Home maintenance: Although home insurance will not usually cover damage due to home neglect, insurance companies are less likely to want to insure poorly-maintained homes, as these homes could pose a higher risk of claims or significant damage. Many home insurers are focusing on the age and condition of roofs to determine the cost of coverage due to an increased level of storm claims across the U.S.
• Risk exposure: Homes with the lowest risk of damage — whether that’s from a fire, hurricane, tornado or other insurance peril — are likely to have the lowest premiums. Insurance companies charge more if there is a greater likelihood of a claim being filed due to natural catastrophe or other hazard. Even factors like how far your home is from a fire station can determine your home insurance cost.
• Age of home: Due to aging building materials, older homes are more likely to have problems with heating, plumbing, electricity and other important systems. Older homes may also have outdated systems, like knob and tube wiring, that increase risk. As such, it can be more difficult to get a cheap home insurance premium with an older home.
• Fire rating: An ISO fire rating is a safety metric used by insurance companies that reflects how prepared a town or community to deal with a fire breakout. If your community has a strong ISO rating, it is likely well prepared for fire-related emergencies, which may help to lower your home insurance rate.
• Materials and rebuild cost: Homes built with expensive, hard-to-source materials can drive up estimated rebuild costs, which in turn may drive up home insurance premiums. Large homes or homes with unique features may also be more costly to insure.
• Policy specifics: The fine print of your home insurance policy can help determine how much you pay. Higher policy limits typically mean higher insurance premiums. On the contrary, opting for a higher deductible could help you save money (but doing so means that you agree to pay more out of pocket for a covered claim).
• Home location: ZIP code plays a role in how many insurers determine the cost of your home insurance. Insurers consider your area’s perils history — whether they are crime-related, weather-related or otherwise — when calculating your rate. Location may also help lower your rate; homes situated near fire stations and fire hydrants might enjoy a less expensive premium.

That being said, most homeowners should be able to find affordable home insurance for their situation, but this isn’t always the case. Finding coverage at all, let alone cheap homeowners coverage, can be difficult in some states. Florida, for instance, is experiencing a homeowners insurance crisis. Many insurance companies have gone insolvent or have left the state due to widespread fraudulent roofing claims, legal system abuse and massive payouts resulting from an increasing severity of hurricanes. Similarly, major insurance providers State Farm and Allstate have both halted issuing new home insurance policies in California. Both insurers cited increased wildfire losses and higher home rebuild costs as factors in the decision. The Louisiana homeowners insurance market is also struggling, forcing homeowners to scramble for coverage.

While these situations may be outliers, it's important to know that your local insurance market can dictate whether or not you qualify for cheap homeowners insurance. Still, the cheapest homeowners insurance for you will depend on your individual circ*mstances. Understanding your needs, what insurance options are available to you and comparing rates may help you find affordable insurance.

Securing a lower premium for homeowners insurance often begins with diligent research to identify affordable providers. However, beyond choosing a competitively priced insurer, there are actionable steps to potentially reduce your premiums further. One effective strategy is to reassess your policy for coverage that may no longer be necessary. Over time, changes in your home's value, possessions or personal circ*mstances can impact your insurance needs. By fine-tuning your coverage to align more closely with your current situation, you might find opportunities to save on your homeowners insurance costs without compromising on essential protection.

Common home insurance discounts

You might already get home insurance discounts on your policy, but you could also be missing some options. Talk to your provider to see if there are other ways to save. Sometimes the perks go beyond saving money; there are numerous benefits of bundling your home and auto insurance, for example.

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