Factors Affecting Homeowners Insurance Premiums

Factors Affecting Homeowners Insurance Premiums
March 1, 2023 Unland

A homeowners insurance policy like policies offered by UNLAND INSURANCE & BENEFITS is an essential part of protecting your home, your belongings, and your family. Of course, knowing how much you’ll pay before you buy a policy is important, but how do you determine how much your premium will be?

What Factors Affect Premiums?

There’s no easy answer. Homeowners insurance premiums are affected by several factors, meaning you and your neighbor could pay different prices for the same policy with the same carrier. Identifying those circumstances can help you make an informed decision toward your family’s safety and wellbeing. Check out this video on our webpage on some common factors affecting homeowners insurance premiums and get the inside info before you purchase a policy.

Protecting your home, your property, and your family with a homeowners insurance policy is one of the most crucial aspects of ensuring the safety and wellbeing of your loved ones. Standard homeowners insurance policies cover four key areas:

  • Physical structure of home – & other structures like garages or sheds
  • Personal belongings – whether in your home or elsewhere
  • Temporary living expenses – if home uninhabitable due to covered loss
  • Liability protection – if someone gets injured or property is damaged

Options Affecting Premiums

Options are available for additional coverage based on individual needs. For instance, you may add a rider to your policy to cover valuable items such as jewelry, guns, collectibles and more. Damages caused by flood and earthquakes are not covered in a standard policy, but additional coverage can be purchased if you live in an area where you would be at risk.

Other Key Factors Affecting Premiums

In the United States, the average cost of homeowners insurance for $250,000 in dwelling coverage is $1,383 per year*. Your rate could be higher or lower since rates are calculated using a number of different home insurance cost factors. Home characteristics, like the age of your home, structural materials and square footage may all help determine your premium, as well as personal and household factors, like the owner’s credit and claims history. *Source: bankrate.com.

Your state and ZIP code may influence your homeowners insurance premium. If your home is located in an area with a history of perils, such as vandalism, theft or weather-related events, you may see a higher premium. If located near a staffed fire station your premium may be lower. Location may be used to determine replacement cost of your home since construction costs, including labor and materials, varies by region. Other factors that can impact premiums are marital status, deductible choices, and even dog breed.

Dwelling Coverage Options

Dwelling coverage is the portion of a homeowners insurance policy covering your home’s structure. Some policies let you choose coverage at replacement cost value or actual cash value, impacting your premium. Replacement cost value provides coverage to rebuild your home and replace your belongings at today’s costs, while actual cash value factors in depreciation and pays out to rebuild or replace items at current value.

Ready to learn more about homeowners insurance premiums? Talk with UNLAND INSURANCE & BENEFITS. Contact Noele Tatlock today! She is ready to help you get the right coverage. Call (309)642-6855 or email ntatlock@unland.com.