The best homeowners insurance companies of 2021

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A home is the biggest asset most Americans have and homeowners insurance varies depending on your dwelling type: home, condo, mobile home, or new construction. When considering homeowners insurance, it is important to make sure that you have proper coverage for your home and belongings.

Although homeowners insurance is not required by law, if you have a mortgage your lender will require homeowners insurance to protect the home.

The best homeowners insurance companies

The 5 best homeowners insurance companies

  1. USAA*
  2. Amica Mutual
  3. Auto-owners 
  4. State Farm
  5. Erie Insurance

*USAA is only for active military, veterans, and their families.

Insider looked at the top companies in size according to S&P Global data, and customer satisfaction from JD Power and Associates. Also considered were nationwide availability and the most recent credit rating from A.M. Best or Fitch Ratings.

1. USAA

USAA is only available to active military, veterans, and their families. It is available in all states and consistently ranks at the top of claims and customer satisfaction surveys.

2. Amica Mutual

Amica homeowners insurance is a strong competitor in customer satisfaction, earning the top spot in JD Power’s study of all widely available insurers. It’s available in 48 states.

Unlike other insurers on this list, Amica’s insurance policies offer a dividend, where money is returned to you. On average, Amica’s dividend policies return between 5% and 20% of annual premiums. Quotes are available online without an agent, making it easy to compare to other insurers. 

3. Auto-Owners

While this company is named for its auto insurance coverage, Auto-Owners  offers home insurance and insures about 1.5% of America’s homes. A high credit rating, along with high marks for claims and customer service helps this insurance company stand out. 

4. State Farm

State Farm is an established insurance industry and ranks in the top ten in claims and customer satisfaction. home insurance policies are available in all 50 states. They’re also available to purchase on your own online without an agent. Since State Farm provides auto, disability, and life insurance, it could be beneficial to bundle all your insurance together for a discount.

5. Erie Insurance

Although only available in 13 states, Erie earned top marks for credit ratings, customer satisfaction, and claims.

Best homeowners insurance based on claims satisfaction

A cheap homeowners insurance policy does little if the company is bad at claims satisfaction — especially if you live in disaster prone areas. According to J.D. Power, a consumer research company that surveys customers, this is how homeowners insurance companies ranked in claims satisfaction:

Homeowners insurance Claims ranking out of 1000 points
USAA* 904
Amica 902
The Hartford 896
Farmers 893
Auto-owners 889
Nationwide 886
Erie Insurance 885
Allstate 882
American Family 881
Industry Average 881
State Farm 878
Liberty Mutual 877
MetLife 877
AIG 876
Safeco 875
Travelers 872
Chubb 871
Progressive 867
Auto Club Southern California 855

*USAA is only for active military, veterans, and their families.

Best homeowners insurance based on customer satisfaction

The latest study from J.D. Power, a consumer research company that conducts consumer surveys, shows that a homeowners insurance company’s customer service and reputation are more important than price for homeowners. Here’s how homeowners insurance companies ranked when consumers were asked about satisfaction overall:

Homeowners insurance company Customer satisfaction ranking out of 1000 points
USAA* 889
COUNTRY Financial 855
Amica 853
Auto-owners 843
Erie 839
The Hartford 832
Allstate 829
State Farm 829
CSAA 825
MetLife 824
Segment Average 823
American Family 821
Auto Club of Southern CA 820
Farmers 814
AIG 809
Nationwide 808
Liberty Mutual 805
Travelers 803
Safeco 802
Progressive 797
Chubb 778

*USAA is only for active military, veterans, and their families.

The average cost of homeowners insurance

The average annual premium in the United States in 2019 was $1,015, according to the most recent data from S&P Global.

The age of your home, age of your roof, the appraised value, your home’s size (square footage), your location, and whether you own pets are some of the determining factors in calculating homeowners premiums. 

If you live in weather-zones or disaster prone areas — flood zones, hurricanes, tornadoes, wildfires, mudslides, hail, and earthquakes — that will increase your premium because that is not included in basic coverage and will need to be add-ons riders. 

Here’s how much homeowners insurance costs on average by home value in the United States, according to the most recent release of the Homeowners Insurance Report by the National Association of Insurance Commissioners (NAIC):

Estimated home value Average annual homeowners insurance premium
$49,999 and under $645
$50,000 to $74,999 $748
$75,000 to $99,999 $826
$100,000 to $124,999 $888
$125,000 to $149,999 $937
$150,000 to $174,999 $981
$175,000 to $199,999 $1,018
$200,000 to $299,999 $1,114
$300,000 to $399,999 $1,272
$400,000 to $499,999 $1,482
$500,000 and above $2,148

What does homeowners insurance cover?

Homeowners insurance protects the dwelling, your belongings, and offers liability coverage for injuries that events that happen on your property. Those events are known as “insurance perils.” Perils are specific events that cause damage to your home, like fire, theft, or a storm.

Earthquakes, floods, government seizures, mudslides, ordinance updates, sewer backups and sinkholes typically aren’t covered under standard homeowners insurance policy and will require add-on coverage using a rider policy.

Policy Type Dwelling Liability Belongings
HO-1 Basic* Yes No No
HO-2 Broad* Yes No Yes
HO-3 Special (Standard) Yes Yes Yes
HO-4 Renters No Yes Yes
HO-5 Comprehensive** Yes Yes Yes
HO-6 Condo/Co-op Yes*** Yes Yes
HO-7 Mobile Homes Yes Yes Yes
HO-8 Older Homes Yes Yes Yes

Data from Hippo Insurance

*Most lenders don’t consider this sufficient coverage.

**Typically for brand-new homes only.

***Check with your homeowners association (HOA) master policy.

How to find homeowners insurance

If you currently have homeowners insurance, review your policy coverage yearly. If your homeowners insurance company hasn’t provided the level of service you expected, maybe it is time for you to select a new provider.

Remember that a cheap price doesn’t mean good customer service. Focus on claims and customer satisfaction rankings, like those from J.D. Power, and comparison shop. This is especially important for those living in disaster-prone areas, when good service can make all the difference.

How were the winners determined?

Insider looked at five factors to determine the best homeowners insurance: customer satisfaction ranking, claims satisfaction ranking, credit financial rating, market share, and nationwide availability.

Customer satisfaction and claims satisfaction rankings were determined using J.D. Power’s 2020 surveys. Market share data was gathering from S&P Global Market Intelligence. Credit ratings are from A.M. Best and Fitch.

Ronda Lee is an associate editor for insurance at Personal Finance Insider covering life, auto, homeowners, and renters insurance for consumers. She is also a licensed attorney who practiced litigation and insurance defense.

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