Factors that May Impact Your Home Insurance Rates

Factors that May Impact Your Home Insurance Rates


Most of the unfortunate events that can impact your home—from electrical fire to natural disasters like tornadoes and earthquakes are beyond your control. That's what home insurance is for: to protect your home, property, and yourself from unexpected damage and loss. 

Factors that affect home insurance rates are aplenty. They can also vary from one provider to another. Some of the factors are manageable, while others are entirely beyond your control.

 Unfortunately, many people are clueless when it comes to the factors that affect their home insurance premiums. Often, homeowners get frustrated when they see an increase in their insurance bills and have no idea what it is about.

Factors that Can Affect Your Home Insurance Rates

Some of the factors that can affect your home insurance rates include:

●      Cost of your home

●      Cost of your belongings

●      Your deductible

●      Coverage options

●      Insurance history

●      Claims history

●      Upgrades

Other Factors that Can Affect Your Home Insurance Rates


When it comes to home insurance rates, where you live matters. For example, Hawaii has the lowest insurance rates, while Oklahoma has the highest. The former's low insurance rate can be attributed to the fact that most home insurance providers in Hawaii don't cover hurricanes and require a different policy.

Homeowners in Florida, California, and the Atlantic coasts also have a higher insurance rate because of insurance fraud and storm frequency. However, it's not the state alone that determines home insurance cost. If anything, rates can vary from one neighborhood, city, and street to another.

Also, if you live in an area with a high crime rate, your rates will likely be higher as well. The good news? Your insurer may provide a rebate if you install alarms and security cameras.

Age and Construction

 Frequently, older homes are more costly to insure compared to new ones. For starters, older homes are more prone to damage and will require more in terms of upkeep. However, the home's age is not the only thing that's taken into account.

 Your home's materials and construction are also considered as they can bring certain risks as well. Aluminum sidings, stone, and brick are more resistant to fire and other elements. In contrast, wood is considered a liability and may cause premiums to increase.

The age and condition of the roof is another thing most insurers also look into. Repairing or replacing the roof may reduce your home insurance premiums. While discounts can vary depending on the policy, a 5 to 35 percent reduction for roof upgrades is considered ideal.

Personal Profile 

Marital status can also have a direct impact on your home insurance premium. Single individuals may be seen as more of a risk. On average, married couples, on the other hand, tend to file fewer claims.

 Insurance providers may also look into your credit history, outstanding debt, payment history, and the types of credits you have. If you have filed an insurance claim in the past, you'll also be considered a potential risk, and you might face as much as a 40 percent bump in your home insurance rates.

Home Business 

With the COVID-19 pandemic still ongoing, working from home has become the new norm. If your home office consists of just you and your computer, it is likely that you won't need additional coverage.

However, if you have a full-fledged home business, you might need additional coverage for electronics, business vehicles, inventory, and other equipment. This is especially true for those who have customers, contractors, and clients that come to your home on a routine basis.

If you have a trust or limited liability company (LLC), you have the option to tailor your home insurance to ensure the interests of both the residents and the corporate entity are protected.

In other cases, getting a commercial insurance policy might be recommended. In other instances, getting a commercial insurance policy might be recommended. It would be best to speak with your adviser about your specific situation to get proper guidance.


 Several factors can affect your home insurance rates. In line with this, it would be best to check with your insurance agent, so you'll know the factors considered in your case. Your insurance agent can also provide the much-needed guidance so you'll be able to invest in the home insurance policy that's best for you.

Written by Rachael Harper

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