How Much Is Homeowners Insurance on a $200,000 House?

Homeowners insurance is essential for protecting your home and personal belongings.

The annual cost to insure a $200,000 home can range from $600 to more than $8,000, but your price will vary depending on your location, the level of coverage you choose, your home’s features, your claims history, and even your credit history.

Here’s a closer look at those cost factors and your coverage options to help you get the best homeowners insurance for your needs.

How much is insurance for a $200,000 house?

Nationwide, the average annual premium for homeowners insurance on a $200,000 home is $1,848. Most homeowners pay for insurance as part of their monthly mortgage payment. This money goes into an escrow account your lender uses to pay the annual premium on your behalf. But when you purchase a home, you may need to pay the first year’s premium up front as part of your closing costs.

Some of the cheapest homeowners insurance companies include Westfield, Grange, and Hastings Mutual Insurance Company, but rates vary by state and policy details. Below is a table with the 10 cheapest homeowners insurance companies and their average home insurance costs for homes worth $200,000.

Average cost of home insurance on a $200,000 house by state

Home insurance rates vary from state to state due to factors like local weather patterns, the frequency of natural disasters, and the cost of building materials in the area.

For example, Florida is the most expensive U.S. state in terms of average homeowners insurance cost because it’s prone to hurricanes. Homebuyers in Louisiana tend to pay higher premiums for the same reason. On the other side of the spectrum, Maine and Vermont are low-cost states because severe weather events are less common.

Below is a table showing the average annual home insurance rate for a $200,000 homeowners insurance policy by state.

What homeowners insurance covers

Homeowners insurance isn’t a legal requirement, but most mortgage lenders will require you to maintain a home insurance policy during your loan term as part of your mortgage loan agreement.

The most common type of homeowners insurance policy is the HO-3, which provides broad coverage for your home, belongings, and personal liability.

Other policy types offer varying levels of coverage. For example, the HO-1 — the most basic home insurance policy available — limits coverage to specific perils named on the policy.

Here’s what a typical HO-3 policy covers:1

A standard homeowners insurance policy doesn’t cover damage caused by earthquakes or floods. You may need to buy a separate policy if you live in a high-risk area.

How much coverage do you need for a $200,000 home?

How much home insurance coverage you need depends on the cost of rebuilding the home — not just your home loan amount or the home’s market value, which also includes the price of the land. Carrying enough coverage to rebuild the house protects you financially in the event of a total loss.

Typically, your insurance agent will recommend a coverage limit for the structure of your home. But you can get an idea of how much coverage you need by multiplying the total square footage of your home by the average per-square-foot building costs in your area. Your local real estate agent or builder’s association can provide this information.

You may need higher limits if your home has special features like arched windows or fireplaces, which increase rebuilding costs.2

Factors that affect the cost of home insurance

A number of factors influence the cost of homeowners insurance, including:3

• Location: It typically costs more to insure homes in areas prone to severe weather events like hurricanes, tornadoes, or wildfires. Local crime rates and proximity to emergency services also affect pricing.

• Age and condition: Older homes and those in poor condition often cost more to insure because of outdated wiring, roofs, or construction materials that increase the risk of damage. Newer homes built to current safety standards may qualify for discounts.

• Coverage amounts: The more coverage you need for your dwelling, personal property, and liability, the higher your home insurance premium.

• Deductible: Your deductible is the amount you’ll pay out of pocket after a claim. Choosing a higher deductible can lower your premium.

• Credit: In some states, insurers can use your credit history as a factor when determining your premiums. Poor credit often leads to higher rates because insurance companies see you as more likely to file claims.

How to save on homeowners insurance

Saving on homeowners insurance doesn’t have to mean sacrificing coverage. Here are a few strategies to reduce your monthly payment:

• Bundle policies. Many insurance companies offer discounts if you bundle your home insurance with other policies, like auto or life insurance.

• Improve home safety features. Installing smoke detectors, security systems, or deadbolt locks can qualify you for discounts by reducing your home’s risk of damage or theft.

• Ask about other discounts. Insurance companies may offer discounts for being claims-free or being part of specific professional groups.

• Maintain good credit. Since your credit affects premiums in many states, improving your credit can lower your insurance costs.

• Compare quotes. Shop around and compare quotes from multiple insurance companies. Rates can vary significantly, even for the same insurance coverage, so it pays to explore your options.

Homeowners insurance on a $200,000 home FAQs