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The average homeowners insurance premium rose by 3.1 percent in 2018, following a 1.6 percent increase in 2017, according to a January 2021 study by the National Association of Insurance Commissioners, the latest data available. The average renters insurance premium fell 0.6 percent in 2018 marking the fourth consecutive annual decline. Renters insurance premiums fell 2.7 percent in 2017. (See tables in Expenditures for homeowners and renters insurance section).
On average, over nine survey years ending in 2020, 49 percent of homeowners said they prepared an inventory of their possessions to help document losses for their insurers, according to polls conducted for the Insurance Information Institute (Triple-I). Forty-three percent of homeowners said they had an inventory in the 2020 Triple-I Consumer Poll. The survey showed that homeowners in the South and West were more likely to have a home inventory (48 percent and 41 percent), followed by homeowners in the Northeast and Midwest (both regions at 39 percent).
In 2019, 5.1 percent of insured homes had a claim, according to ISO. Property damage, including theft, accounted for 97.2 percent of homeowners insurance claims in 2019 (latest data available). Changes in the percentage of each type of homeowners loss from one year to another are partially influenced by large fluctuations in the number and severity of weather-related events such as hurricanes and winter storms. There are two ways of looking at losses: by the average number of claims filed per 100 policies (frequency) and by the average amount paid for each claim (severity). The loss category “water damage and freezing” includes damage caused by mold, if covered. Every state except Alaska, Arkansas, New York, North Carolina and Virginia has adopted an ISO mold limitation for homeowners insurance coverage, which allows insurers to exclude the coverage unless the condition results from a covered peril.
(Percent of losses incurred)
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(1) For homeowners multiple peril policies (HO-2, HO-3, HO-5 and HE-7 for North Carolina). Excludes tenants and condominium owners policies. Excludes Alaska, Texas and Puerto Rico.
(2) First party, i.e., covers damage to policyholder's own property.
(3) Includes vandalism and malicious mischief.
(4) Payments to others for which policyholder is responsible.
(5) Includes coverage for unauthorized use of various cards, forgery, counterfeit money and losses not otherwise classified.
(6) Less than 0.1 percent.
Source: ISO®, a Verisk Analytics® business.
Average Homeowners Losses, 2015-2019 (1)
(Weighted average, 2015-2019)
(1) For homeowners multiple peril policies (HO-2, HO-3, HO-5 and HE-7 for North Carolina). Excludes tenants and condominium owners policies. Excludes Alaska, Texas and Puerto Rico. Source: ISO®, a Verisk Analytics® business. |
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Homeowners Insurance Claims Frequency*
*Insurance Information Institute calculations, based on ISO®, a Verisk Analytics® business, data for homeowners insurance claims from 2015-2019 (see table above).
(Weighted average, 2015-2019)
(1) For homeowners multiple peril policies (HO-2, HO-3, HO-5 and HE-7 for North Carolina). Excludes tenants and condominium owners policies. Accident year incurred losses, excluding loss adjustment expenses, i.e., indemnity costs per accident year incurred claims. Excludes Alaska, Texas and Puerto Rico.
(2) Includes vandalism and malicious mischief.
(3) Includes coverage for unauthorized use of various cards, forgery, counterfeit money and losses not otherwise classified. This figure is significantly lower than previous five-year results due to a change in the companies surveyed to produce the data.
Source: ISO®, a Verisk Analytics® business.
(Weighted average, 2015-2019)
(1) Claims per 100 house years (policies). One house-year represents policy coverage on a dwelling for 12 months. For homeowners multiple peril policies (HO-2, HO-3, HO-5 and HE-7 for North Carolina). Excludes tenants and condominium owners policies. Excludes Alaska, Texas and Puerto Rico.
(2) Includes vandalism and malicious mischief.
(3) Includes coverage for unauthorized use of various cards, forgery, counterfeit money and losses not otherwise classified.
Source: ISO®, a Verisk Analytics® business.
In March 2013 an entire house fell into a huge sinkhole in a suburb of Tampa, Florida, garnering national attention. Although such large, sudden and destructive sinkholes are relatively rare, thousands of small sinkholes appear in the U.S. each year. The most damage from sinkholes occurs in Florida, Texas, Alabama, Missouri, Kentucky, Tennessee and Pennsylvania, according to the U.S. Geological Survey. Most homeowners insurance policies exclude coverage for sinkhole damage. However, homeowners insurance companies in Florida and Tennessee are required to offer the coverage. In Florida catastrophic ground cover collapse is mandatory; comprehensive sinkhole coverage is optional. (Note: For information on the Florida law see http://www.insuringflorida.org/articles/sinkholes.html. For statistics on Florida sinkholes see http://www.floir.com/sections/pandc/sinkholepage.aspx).
The Bureau of Labor Statistics consumer price index (CPI) tracks changes in the prices paid by consumers for a representative basket of goods and services. The cost of living (all items) rose 4.7 percent in 2021. The cost of motor vehicle insurance increased 3.8 percent after a 4.6 percent decline in 2020, when drivers reduced their driving due to the COVID-19 pandemic. The cost of tenants and household insurance declined slightly, down 0.3 percent. Used cars and trucks increased a significant 26.6 percent and the median price of a single family home increased 17.7 percent and nearly 100 percent since 2012.
(Base: 1982-84=100)
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(1) December 1996=100.
(2) December 1983=100.
(3) December 1997=100.
(4) Only includes insurance covering rental properties.
(5) Includes appliances, reupholstery and inside home maintenance.
NA=Data not available.
Note: Percent changes are calculated from unrounded data.
Source: U.S. Department of Labor, Bureau of Labor Statistics; National Association of Realtors.
The average homeowners insurance premium rose by 3.1 percent in 2018, following a 1.6 percent increase in 2017, according to a January 2021 study by the National Association of Insurance Commissioners, the latest data available. The average renters insurance premium fell 0.6 percent in 2018 marking the fourth consecutive annual decline. Renters insurance premiums fell 2.7 percent in 2017.
The U.S. homeownership rate was 65.5 percent in the fourth quarter of 2021, according to the U.S. Census Bureau. The 2010 Census showed that in some of the largest cities renters outnumbered owners, including New York, where 69.0 percent of households were occupied by renters, followed by Los Angeles (61.8 percent), Chicago (55.1 percent) and Houston (54.6 percent).
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(1) Based on the HO-3 homeowner package policy for owner-occupied dwellings, 1 to 4 family units. Provides all risks coverage (except those specifically excluded in the policy) on buildings and broad named-peril coverage on personal property, and is the most common package written.
(2) Based on the HO-4 renters insurance policy for tenants. Includes broad named-peril coverage for the personal property of tenants.
(3) Less than 0.1 percent.
Source: © 2022 National Association of Insurance Commissioners (NAIC). Reprinted with permission. Further reprint or distribution strictly prohibited without written permission of NAIC.
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(1) Includes state funds, residual markets and some wind pools.
(2) Based on the HO-3 homeowner package policy for owner-occupied dwellings, 1 to 4 family units. Provides all risks coverage (except those specifically excluded in the policy) on buildings and broad named-peril coverage on personal property, and is the most common package written.
(3) Ranked from highest to lowest. States with the same premium receive the same rank.
(4) Based on the HO-4 renters insurance policy for tenants. Includes broad named-peril coverage for the personal property of tenants.
(5) Data provided by the California Department of Insurance.
(6) Texas data were obtained from the Texas Department of Insurance.
Note: Average premium=Premiums/exposure per house years. A house year is equal to 365 days of insured coverage for a single dwelling. The NAIC does not rank state average expenditures and does not endorse any conclusions drawn from this data.
Source: ©2022 National Association of Insurance Commissioners (NAIC). Reprinted with permission. Further reprint or distribution strictly prohibited without written permission of NAIC.
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(1) Includes policies written by Florida Citizens Property Insurance Corp. and Louisiana Citizens Property Insurance Corp., Alabama Insurance Underwriting Association, Massachusetts Property Insurance Underwriting Association, Michigan Basic Property Insurance Association, Mississippi Windstorm Underwriting Association and Residential Property Insurance Underwriting Association, New Jersey Insurance Underwriting Association, North Carolina Joint Underwriting Association, Ohio Fair Plan Underwriting Association, Rhode Island Joint Reinsurance Association and South Carolina Wind and Hail Underwriting Association, and Virginia Property Insurance Association. Other southeastern states have wind pools in operation and their data may not be included in this chart. Based on the HO-3 homeowner package policy for owner-occupied dwellings, 1 to 4 family units. Provides all risks coverage (except those specifically excluded in the policy) on buildings and broad named-peril coverage on personal property, and is the most common package written.
(2) States with the same premium receive the same rank.
(3) The Texas Department of Insurance developed home insurance policy forms that are similar but not identical to the standard forms. In addition, due to the Texas Windstorm Association (which writes wind-only policies) classifying HO-1, 2 and 5 premiums as HO-3, the average premium for homeowners insurance is artificially high.
(4) Data provided by the California Department of Insurance.
Note: Average premium=Premiums/exposure per house years. A house year is equal to 365 days of insured coverage for a single dwelling. The NAIC does not rank state average expenditures and does not endorse any conclusions drawn from this data.
Source: © 2020 National Association of Insurance Commissioners (NAIC). Reprinted with permission. Further reprint or distribution strictly prohibited without written permission of NAIC.
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(1) Based on the HO-3 homeowner package policy for owner-occupied dwellings, 1 to 4 family units. Provides all risks coverage (except those specifically excluded in the policy) on buildings and broad named-peril coverage on personal property, and is the most common package written.
(2) Texas data were obtained from the Texas Department of Insurance.
Source: © 2022 National Association of Insurance Commissioners (NAIC). Further reprint or distribution strictly prohibited without written permission of NAIC.
($000)
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(1) Before reinsurance transactions, includes state funds.
(2) Based on U.S. total, includes territories.
Source: NAIC data, sourced from S&P Global Market Intelligence, Insurance Information Institute.
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(1) After reinsurance transactions.
(2) As a percent of net premiums earned ($94.6 billion in 2020).
(3) As a percent of net premiums written ($97.0 billion in 2020).
(4) Sum of loss and LAE, expense and dividends ratios. Calculated from unrounded numbers.
Source: NAIC data, sourced from S&P Global Market Intelligence, Insurance Information Institute.
In 2020, 31.8 million Americans experienced an unintentional injury in the home that required aid from a medical professional, according to an analysis by the National Safety Council (NSC). There were 113,500 deaths from unintentional home injuries in 2020, up 21.1 percent from 2019. The overall death rate rose to 34.4 deaths per 100,000 people in 2020. Since 1912, the death rate had been almost unchanged at 28.5 deaths per 100,000 people. The number of unintentional home injury deaths has increased by 272 percent since 1999, largely due to increases in unintentional poisonings and falls.
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Source: National Safety Council estimates based on data from National Center for Health Statistics and state vital statistics departments.
A myriad of different programs in place across the United States provide insurance to owners of property in high-risk areas who may have difficulty obtaining coverage from the standard market. Residual, shared or involuntary market programs make basic insurance coverage more readily available. Today, property insurance for the residual market is provided by Fair Access to Insurance Requirements (FAIR) plans, beach and windstorm plans, and two state-run insurance companies in Florida and Louisiana: Florida’s Citizens Property Insurance Corp. and Louisiana’s Citizens Property Insurance Corp. Established in the late 1960s to ensure the continued provision of insurance in urban areas, FAIR plans often provide property insurance in both urban and coastal areas. Beach and windstorm plans cover predominantly wind-only risks in designated coastal areas. Over the past four decades FAIR and beach and windstorm plans experienced explosive growth both in the number of policies and in exposure value. However, the number of policies in FAIR plans peaked in 2011 and had been falling steadily through 2018, down 49.7 percent from 2011 to 2018, while exposure dropped by 54.6 percent. In 2019 the downward trend ended and from 2018 to 2020, total policies grew 10.1 percent while exposure grew 30.8 percent.
In 2020, 66.6 percent of housing units were owner occupied and 33.4 percent were renter occupied, according to the latest U.S. Census figures. In 2019, 32.1 percent of owner-occupied units housed people age 65 and over. The same year, 16.2 percent of rental units housed people over age 65.
The nation's homeowners paid a median of $1,510 monthly housing costs in 2019, compared with $1,301 for renters, according to the latest American Housing Survey from the Census.
However, renters usually paid a higher percentage of their household income on these costs than did owners, 45.1 percent compared with 26.5 percent of homeowners who spent 30 percent or more of their income on housing costs in 2019.
Percent Of Occupied Housing Units That Are Owner Occupied, 2020
(1) States with the same percentages receive the same rank. Source: U.S. Census Bureau, Current Population Survey/Housing Vacancy Survey, March 9, 2021. |
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Percent Of Renter Occupied Units Spending 30 Percent Or More Of Their Income On Rent And Utilities, 2019
(1) Percent of renter-occupied units spending 30 percent or more on rent and utilities such as electric, gas, water and sewer, and fuel (oil, coal, etc.) if paid by the renter. Source: U.S. Department of Commerce, Census Bureau; American Community Survey. |
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