If you’re budgeting for a new home, it’s important to incorporate the average cost of home insurance. Insurance rates are composed of many factors, and knowing these factors can help you estimate the potential expense.
Here is a quick guide to the variables determining the average cost of homeowners insurance:
Homeowners insurance cost is partially determined by certain aspects of the home itself. The biggest factors include location, age and condition. If your home is located in an area prone to extreme weather or other potentially damaging conditions, it’s considered a higher risk to the insurer and may incur a higher premium.
Older homes are more likely to need repairs, and those repairs can cost more. Similarly, if your home’s condition is less than ideal, your insurance premium may be higher as a result.
There are several variables in your policy that go into the average homeowners insurance cost. The most important variables are:
There may be other factors that impact the cost of homeowners insurance. Some of these are related to your home and lifestyle, like whether you have a pool, trampoline or aggressive pets. Others might concern your financial history, including credit score and past insurance coverage.
If you want more details about what goes into the average cost of home insurance, consult your insurance provider.