Your Address Might Be Costing You More in Home Insurance—Expert Tips To Save on Premiums

Home insurance coverage will vary for every policy, but aside from the value and age of your home, several factors can influence premium amounts.

"Home insurance rates are based on where you live, and one of the biggest factors is the area’s history with things like crime and past claims," Erika Tortorici, owner and principal of Optimum Insurance Solutions, tells Realtor.com®.

A homeowner's ZIP code will play a role. Tortorici explains that if your home is in a neighborhood with fewer reported crime incidents, your rate will generally be lower compared to a more densely populated area with a higher crime rate.

"There’s no set amount or percentage of savings. Insurance companies use years of data, like thefts and fire claims, to calculate pricing for each region," Tortorici says.

In 2024, homeowners in Colorado, Nebraska, Texas, and Florida paid the highest insurance costs in the nation, according to September's American Community Survey data from the U.S. Census Bureau. Homeowners in those states carried policies with a median annual cost of $2,000 to $2,499.

On the flip side, if you live in an area where natural disasters occur, expect to pay a higher premium. This includes hurricane, tornado, and wildfire risk zones.

"If you live in an area at risk for a disaster, you’ll pay insurance rates that reflect the level of risk. You could pay twice as much as someone in a low-risk area," Melanie Musson, home insurance expert with Quote.com, tells Realtor.com. "Many homeowners in the highest risk areas find securing coverage at all a challenge, and some are forced to turn to state-sponsored insurance programs."

Home premium influencers

A consideration that insurance brokers point out is a home's replacement cost, which is the estimated amount it would take to rebuild the home from the ground up.

"This is different from the home's market value. Replacement cost is influenced by the home’s size, materials, and key systems like HVAC and electrical," Peter Piotrowski, chief claims officer at Hippo home insurance, tells Realtor.com. "While insurers often estimate this for you, it’s wise to check with a local builder to make sure your coverage is adequate."

Piotrowski points out that another factor in home insurance premiums will be the amount of dwelling coverage. This is the portion of your policy that covers the home and any attached or detached structures on the property—like garages, sheds, fences, and porches.

"Many mortgage companies require you to have enough dwelling coverage to cover 100% of your property’s replacement cost. You may also have the option to purchase extended replacement cost coverage, which can reimburse up to 125% of your dwelling limit in certain cases," says Piotrowski.

And he says the age of your home can also hike your rate.

"Older homes may cost more to insure. For example, old wooden floors, trims, and moldings typically require more time and specialized knowledge to be replaced," says Piotrowski.

With safety being key, the distance a home is to a fire station can save you money on premiums.

"Usually, those within a 5- or 10-mile radius of a fire station pay less, while those in rural or outlying areas pay more," says Musson. "You may pay up to 5% less on insurance premiums for living near a fire station."

"Homes in more rural or harder-to-reach areas often face higher premiums, and in some cases, certain carriers may decline coverage altogether if a property is considered too remote," Tortorici adds.

Trampolines, which can be found in many backyards, may be fun for the kids, but they can be an insurance headache for parents.

"Pools and trampolines can also lead to injuries on your property," says Piotrowski.

This falls under liability coverage, which also affects home insurance premiums.

"Liability coverage protects you if someone is injured on your property or if you’re held responsible for property damage," Piotrowski explains. "Most standard policies include at least $100,000 in liability coverage, but you can (and should) adjust this amount based on your needs."

Ways to save on home insurance premiums

The insurance experts we spoke to all agree that there are ways to save on your premium by making simple changes within your home.

Having alarm systems and automatic water shut-off valves, as well as updating systems such as electrical and plumbing, will help.

"Keeping up with regular maintenance helps, too. Another easy way to lower your premium is by choosing a higher deductible," says Tortorici.

Managing debt well works in a homeowner's favor. Musson tells Realtor.com that an excellent credit score "could save 15% on home insurance premiums compared to if you had a low credit score."

Piotrowski advises that when deciding how much coverage you need, it’s important to make sure you have enough coverage to do the following:

• Rebuild your home and other structures on your property (dwelling coverage) 
• Replace your personal belongings (personal property coverage)
• Cover injuries on your property (liability coverage)
• Maintain your quality of life while living somewhere else if your house becomes unlivable (additional living expense coverage)