Here's Where Homeowners' Insurance Premiums Are The Most Expensive

By
Kathleen Marshall
Kathleen Marshall
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Kathleen Marshall has over 25 years of writing and editing experience. She is a member of the Blockchain Council and is a certified cryptocurrency expert.
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Published March 29, 2024
02:18 PM EDT
An insurance adjuster takes pictures atop a roof stripped of its tiles in Hollywood, Florida, on Sept. 28 after a reported tornado touched down overnight.
An insurance adjuster takes pictures atop a roof stripped of its tiles in Hollywood, Florida, on Sept. 28 after a reported tornado touched down overnight.

Amy Beth Bennett/South Florida Sun-Sentinel/Tribune News Service via Getty Images

Key Takeaways

  • The average annual homeowners' insurance premium in 2023 was 10.8% higher than in the previous year and 40.8% higher than in 2018.
  • Homeowners in Louisiana and other states in the middle of the country are paying more than other Americans.
  • Regulatory factors may keep rates lower in some areas, while a homeowner’s credit may also affect rates.

Homeowners' insurance has become more costly in recent years, and where you live pushes the price up even more.

According to Freddie Mac, the average annual homeowners insurance premium for a typical home in 2023 was $1,522. Premiums were 10.8% higher than in 2022 and 40.8% higher than in 2018.

However, homeowners in Louisiana and other states in the middle of the country are paying more than other Americans.

Various Factors Influence Cost

While one expects to pay higher rates in areas prone to natural disasters, varying factors are at play.

For instance, insurance companies offering homeowners insurance in California are subject to strict regulation, which limits their rates. This may explain, in part, why the cost of homeowners insurance is relatively lower in California than in states with similar disaster risk, such as Louisiana.

Climate change is also a contributing factor, as areas that previously saw few natural disasters suddenly face unusual weather patterns. Last year, 28 weather and climate events caused at least $1 billion in damages, an increase from 22 events in 2020.

In some states, a homeowner’s credit may also be a factor in determining rates. According to Experian, the higher your credit rate, the lower your risk. Southern states have the worst credit scores on average, Experian found. For example, Mississippi has the lowest average credit score in the country at 680.

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  1. FreddieMac.com. “U.S. Economic, Housing and Mortgage Market Outlook - March 2024”

  2. Climate.gov. “2023: A historic year of U.S. billion-dollar weather and climate disasters”

  3. Experian.com. “Does Your Credit Affect Homeowners Insurance?”

  4. Experian. "What Is the Average Credit Score in the US?"