Review of the Highest Home Insurance Rates

08 Apr
A beautiful view of the Islamorada coastline. Also known by Florida homeowners as the highest homeowners insurance rates in the country.

According to a recent rate analysis, the highest homeowner insurance rates in the country are in zip code 33070 which encompasses Islamorada Village of Islands, on Plantation Key in Florida.

Second place in this dubious honor went to ZIP codes in Louise, Texas. Mobile, Alabama managed a third place showing in the analysis while Oklahoma finished fourth and Quinter in Kansas rounded out the top five. Here is an overview of the top five zip codes in the country as well as the average premium these homeowers are paying:

ZIP CodeStateCity/TownAverage Annual Rate
33070FloridaIslamorada Village of Islands$6,295

These rates are dramatically higher than the national average which comes in at $1,228 according to an article. “Rates can fluctuate significantly from state to state, or even neighborhood to neighborhood, depending on how insurers assess the various things they look at,” said Michelle Megna, editorial director of in a recent press release. “That’s why, regardless of where you live, if you don’t compare rates, you can wind up overpaying by hundreds, sometimes thousands, of dollars.”

In many of these zip codes, weather and home values are probably the major culprits in high premiums. These locations are prone to severe weather and most likely flooding. Florida and Texas coastal communities are always prone to severe weather and many of the other zip codes fall into Tornado Alley. This type of weather risk will always push up homeowner rates. 

Insurers take a number of factors into consideration when setting a homeowners insurance premium. A few that they consider are:

  • Home location: Is your house exposed to hazards such as severe weather, wildfires, high crime rate, if the answer is yes to any of those, your rates will be higher.
  • Home value: If your home is destroyed, or severely damaged, your insurer will have to pay to repair or rebuild it so the more expensive your home, the higher your premium.
  • Credit history: Insurance companies put a lot of stock in your credit history as data shows that homeowners with a poor credit history file more claims. 
  • Local construction costs: Local construction costs factor into how much it will cost to rebuild or repair your home, so insurers consider them.
  • Age of Home: Older homes tend to have features that can be expensive to recreate. Hand carved wood, plaster walls and other expensive features can drive up costs. Another factor with older homes is the pipes and wiring behind the walls which most likely has to be updated to today’s codes. All of this can push up costs dramatically. 
  • Swimming pools, trampolines, and dogs: These items will push up premiums due to the additional risk they present. 

Lowest Premium Zip Codes

On the other end of the spectrum are the zip codes with the lowest yearly premium. Here is the breakdown of the five cheapest zip codes in the country:

ZIP CodeStateCity/TownAverage Annual Rate

While Hawaii seems out of place as having some of the cheapest rates in the country, there are reasons it fell on this side of the list. Despite high home prices and severe weather issues, two factors help push down rates in this tropical location.

“One major factor in Hawaii is the fact that most standard homeowner insurance policies do not cover hurricane damage. Hurricane Iniki, which hit in 1992 did so much damage that the majority of insurers excluded hurricane damage from their coverage. Homeowners in Hawaii now have to purchase a separate hurricane damage policy,” said Michael Barry, spokesman for the Insurance Information Institute, in a recent article. 

Another factor that helps lower rates is the fact that Hawaii is one of a handful of states that doesn’t allow insurers to use credit scores when setting rates. This could have a major impact on rates as credit scores are considered a big rating factor. 

Tips to Lower Your Rates

Regardless of whether or not you are in one of the high cost zip codes or a low cost one, lowering your rates is always a plus. Here are a few tips to help make your insurance affordable:

Shop Your Coverage: This is usually the best way to bring your rates down. Insurers rate risk differently which can result in dramatic differences in price quotes. Shop at least five different insurance companies and make sure you are comparing apples to apples when it comes to coverage levels and deductibles. Shop Home Insurance Quotes Now!

Raise Your Deducible: Insurers like it when you shoulder some of the risk so raising your deductible can result in a significant price drop. If you can afford to double your deductible you should see a rate drop of 20 to 25 percent.

Discounts: Insurance companies offer dozens of home and auto insurance discounts so make sure you are getting every discount you are entitled to receive. Have your agent do a discount review to make sure all discounts are being applied to your policy.

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