How we picked the cheapest homeowners insurance companies

Bankrate obtained 2021 premium information for the largest homeowners insurance companies by market share from Quadrant Information Services. We analyzed 142 national and regional companies in 34,523 ZIP codes across the country to ensure that our information is accurate. Using this information in conjunction with J.D. Power customer satisfaction scores and AM Best financial strength ratings, we were able to identify our top picks for the cheapest home insurance companies on the market. All rates listed are for $250,000 of dwelling coverage.

Cheapest overall homeowners insurance companies for January 2022

Based on our research, Erie and USAA offer the cheapest average home insurance rates in the U.S. However, Erie is only available in 12 states, and USAA only serves active-duty military, veterans and their family members. If neither company is an option for you, you might want to get homeowners insurance quotes from Progressive, Nationwide, Auto-Owners or Travelers.
Although finding low-cost homeowners insurance rates may be a priority, you should look for a home insurance policy that provides the coverage you need. After all, your home may be your most significant investment; you want to make sure you and your family are financially protected from a catastrophic loss such as a hurricane, tornado or fire.

Based on Bankrate’s research, if you are looking for the most affordable homeowners insurance options, you may want to start your search by getting quotes from one of these six companies:

Home insurance company Average annual premium for $250,000 dwelling coverage J.D. Power customer satisfaction score AM Best financial strength rating
Erie $897 835/1,000 A+
USAA* $992 882/1,000 A++
Progressive $1,026 821/1,000 A+
Nationwide $1,042 812/1,000 A+
Auto-Owners $1,165 831/1,000 A++
Travelers $1,269 800/1,000 A++

*Not officially ranked by J.D. Power due to eligibility restrictions

Erie

Erie

A good choice for first-time homebuyers on a strict budget

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4.6 Bankrate Score
JD Power: 835/1,000AM Best: A+
$897 for $250k dwelling

Erie Insurance Review

Erie offers the cheapest rates of the property insurers we analyzed, making it a top choice for customers looking for cheap homeowners coverage. The company provides numerous coverage options, like service line protection and water backup coverage, to help you tailor your policy to your needs. Over 13,000 local independent agents across its 12 states can help you get a quote and buy a policy. The super-regional company also ranks highly in customer satisfaction, which may give first-time homebuyers both peace of mind and financial breathing room. It holds an A+ (Superior) financial strength rating from A.M. Best.

USAA

USAA

A good option for active-duty military service members, veterans and eligible family members.

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4.8 Bankrate Score
JD Power: 882/1,000AM Best: A++
$992 for $250k dwelling

USAA Insurance Review

USAA, the third largest home insurer in the U.S. by market share, according to the Insurance Information Institute (Triple-I), is widely considered one of the best insurance companies for exceptional customer service, but coverage is only available to members of the military community and their families. If you qualify for coverage, USAA offers some of the best cheap homeowners insurance on the market, with top-notch service, a wide range of coverage options and consistently low premiums. The company carries an A++ (Superior) financial strength rating from AM Best, the highest level available.

*Not officially ranked by J.D. Power due to eligibility restrictions

Progressive

Progressive

A good choice for comparing rates and saving time.

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3.7 Bankrate Score
JD Power: 821/1,000AM Best: A+
$1,026 for $250k dwelling

Progressive Insurance Review

Progressive is the 10th-largest homeowners insurer in the U.S. and might be appealing if you like handling your insurance needs online or via a mobile app. The company maintains robust online and user-friendly mobile tools that generate quick and easy homeowners insurance quotes that tech-savvy customers may appreciate. However, Progressive’s homeowners underwriting company, American Strategic Insurance (ASI), typically receives below-average customer satisfaction scores from J.D. Power. Progressive maintains an A+ (Superior) financial strength rating from AM Best.

Nationwide

Nationwide

A good choice for consolidating insurance and banking products.

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4.0 Bankrate Score
JD Power: 812/1,000AM Best: A+
$1,042 for $250k dwelling

Nationwide Insurance Review

Nationwide offers diverse coverage options for homes, condos and apartments, farms, pets, vehicles, investment products and much more. For homeowners looking to consolidate their insurance and financial products with one company, Nationwide might be a good choice. Nationwide’s average premium is not the cheapest on our list, but it is still well below the national average. Additionally, the eighth-largest home insurer in the U.S. offers several discounts that could help you lower your rate. Nationwide holds an A+ (Superior) financial strength rating from AM Best.

Auto-Owners

Auto Owners

A good option for flexible coverage.

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4.2 Bankrate Score
JD Power: 831/1,000AM Best: A++
$1,165 for $250k dwelling

Auto Owners Insurance Review

Auto-Owners is a super-regional carrier that offers property coverage in 26 states through a broad network of independent agents. Its home insurance policies are highly flexible, with coverage options like guaranteed home replacement, equipment breakdown and identity theft coverage. Although Auto-Owners’ average premium isn’t the cheapest of the companies Bankrate reviewed, the carrier does offer several discounts, including multi-policy, water shut-off system and mortgage-free. The company carries an A++ (Superior) financial strength rating from AM Best.

Travelers

Travelers

A good choice for customizable coverage.

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3.7 Bankrate Score
JD Power: 800/1,000AM Best: A++
$1,269 for $250k dwelling

Travelers Insurance Review

Travelers’ average premium is only slightly below the national average, but its wide array of coverage choices might make up for its average home insurance rate. Travelers, the 6th largest U.S. home insurer, offers a wide range of coverage options, including jewelry and other valuables, identity fraud and green homes. The company also offers several discounts, including savings for bundling home and auto policies, having an environmentally-friendly home certification and being loss-free. Travelers holds an A++ (Superior) financial strength rating from AM Best. However, the company received a below-average customer satisfaction score from J.D. Power.

Cheapest home insurance companies by state

State-specific factors, such as the likelihood of natural disasters and the rising cost of building materials, can affect your home insurance premiums. Through our research, we determined the cheapest home insurance carrier in each state. If you’re looking for cheap coverage, you could start with a quote from these carriers. According to our research, USAA was the cheapest carrier in many states, but because the company is only available to a certain segment of the marketplace, we chose not to include this carrier in the cheapest home insurers by state table. If you qualify for coverage with USAA, you may find cheap coverage after getting a quote.

State Cheapest home insurance company Average annual premium for $250,000 dwelling coverage
Alabama Cincinnati $740
Alaska Western National $892
Arizona Progressive $674
Arkansas Travelers $1,511
California Mercury $542
Colorado State Auto $589
Connecticut NBIC Holdings Group $502
Delaware Cumberland Group $456
Florida Southern Farm Bureau $645
Georgia Progressive $692
Hawaii Universal Insurance Co. Group $252
Idaho Grange $564
Illinois Travelers $946
Indiana Buckeye Insurance Group $467
Iowa West Bend $676
Kansas Auto-Owners $1,560
Kentucky Cincinnati Insurance $965
Louisiana United Insurance Holdings Group $597
Maine Vermont Mutual $455
Maryland Brethren Mutual $554
Massachusetts Quincy Mutual $731
Michigan Auto-Owners $204
Minnesota Auto-Owners $982
Mississippi Nationwide $659
Missouri AAA $1,359
Montana Chubb $959
Nebraska Nationwide $1,699
Nevada Universal Insurance Co. Group $456
New Hampshire Main Street America $398
New Jersey NJM $355
New Mexico Allstate $1,456
New York NYCM $394
North Carolina Universal Insurance Co. Group $785
North Dakota Farmers Union Mutual $1,070
Ohio Buckeye Insurance Group $371
Oklahoma Farmers $1,844
Oregon Mutual of Enumclaw $317
Pennsylvania Westfield $283
Rhode Island NBIC Holdings Group $551
South Carolina Lighthouse Property Insurance Corp. $565
South Dakota North Star Mutual $1,345
Tennessee Erie $910
Texas Bankers Insurance Group $563
Utah Mutual of Enumclaw $446
Vermont Vermont Mutual $399
Virginia Cincinnati Insurance $443
Washington PEMCO $325
Washington, D.C. Chubb $769
West Virginia Westfield $618
Wisconsin West Bend $512
Wyoming Nationwide $673

Cheapest home insurance companies by credit tier

In most states, your credit-based insurance score is among the rating factors used to determine your home insurance premium. Homeowners with lower credit scores may be more likely to file claims. To compensate for the increased risk, companies usually charge more for homeowners with lower insurance scores. Based on our research, these five companies offer competitive premiums for homeowners with average credit:

Average annual rates by credit score for $250,000 in dwelling coverage

Home insurance company Poor credit Average credit Good credit Excellent credit
Farm Bureau $916 $669 $619 $520
Cincinnati Insurance $1,413 $811 $843 $713
Progressive $1,579 $1,054 $1,026 $926
USAA $1,897 $1,061 $992 $859
Erie $3,521 $1,062 $897 $725

Cheapest home insurance companies for new homeowners

If you are a first-time homebuyer, you may be happy to know that several companies offer new purchase or first-time buyer discounts. The following four companies are among the cheapest carriers with these discount options, which could help your budget amid the expenses of homeownership:

Home insurance company Average annual premium for $250,000 in dwelling coverage
Progressive $1,026
Nationwide $1,042
Travelers $1,269
Allstate $1,458

Cheap home insurance from smaller insurance companies

Larger national insurance companies tend to dominate the advertisements that you see for home insurance coverage, but that doesn’t mean that smaller regional companies don’t have solid coverage. The following regional carriers have low average rates but may only be available in certain areas of the country:

Home insurance company Average annual premium for $250,000 in dwelling coverage
Westfield $643
Secura $715
Pekin $806
Cincinnati Insurance $843
Grange $1,239

Getting started

Although home insurance isn’t legally mandated, your mortgage lender will probably require you to maintain a policy. Home insurance is a smart purchase even if you own your home without a loan; a policy can protect you from financial devastation if your home is damaged or destroyed in a covered incident. While most insurance experts agree that purchasing home insurance is a good idea, you don’t have to overpay for coverage. You can take steps to find the most affordable home insurance policy that fits your needs and provides you with financial peace of mind.

  1. Evaluate your needs: Before you start shopping for coverage, determine what matters to you most. Are you just looking for cheap home insurance? Do you need access to specialty coverage, digital policy management tools or outstanding customer service? Once you know what you need from a homeowners insurance policy, you might be able to narrow down your choices.
  2. Determine your home’s replacement cost: Although each insurance company will have its own valuation tool, knowing how much home insurance you need before you start shopping could be helpful. That way, you can focus on getting a quote for an appropriate amount of dwelling coverage. Just remember that your home’s replacement cost is not the same as its market value. Online tools are available to help you determine your home’s rebuilding cost. Your insurance professional can also help you with this process.
  3. Consider your liability exposure: Most standard home insurance policies come with an average of $300,000 in liability coverage. However, if you have a pool, trampoline, playset or host guests frequently, you may want to consider a higher liability coverage limit or even an umbrella policy. A higher limit will increase your rates a bit, but it provides valuable financial protection against lawsuits if someone is injured on your property to ensure you have an adequate level of protection from a catastrophic loss.
  4. Shop around: Getting insurance quotes from several property insurers allows you to compare rates, coverage, discounts and additional features of each company to find high-quality and cheap homeowners insurance. The Triple-I recommends obtaining a minimum of three quotes when shopping for coverage to help you determine if a company fits your budget and coverage needs. Working with a local insurance agent can be very beneficial in this process.
  5. Improve or maintain your credit score: Most homeowners insurance companies use your credit-based insurance score as a rating factor, although a few states prohibit insurers from using credit information to determine rates. Statistically, homeowners with lower credit are more likely to file claims, according to the Triple-I, so insurance companies charge higher premiums to compensate for this increased risk. Improving or at least maintaining your credit score might help you keep your home premium lower.
  6. Take advantage of home insurance discounts
    Home insurance discounts might help you lower your premium. Although every company offers a different selection of discounts, some common discounts include multi-policy, home safety features, loyalty, new homebuyer and claims-free.

The best way to see if you are taking advantage of your company’s discount programs is to talk to your local insurance agent. Discount availability varies, and an insurance agent should be able to help you identify the discounts you qualify for.

Learn more: How to find the right, cheap home insurance for your budget

What impacts your home insurance premiums?

Home insurance rates vary based on a number of factors. The following aspects of both your personal rating factors and your home could affect how much you pay for coverage:

  • State you live in
  • City you live in
  • Your ZIP code (in most states)
  • Your credit-based insurance score (in most states)
  • Age of your home
  • Square footage of your home
  • Features in your home
  • Home’s replacement cost
  • Age and condition of your roof
  • Proximity to a local fire station and fire hydrants
  • Your claim history
  • Optional coverage types and levels you choose
  • Company you choose
  • Deductibles you choose

Each state has its own insurance regulations as well, which could affect which rating factors are used and how heavily they are weighed by your carrier. Getting quotes from several insurance carriers might help you find the best and cheapest option for you.

What to expect when applying for cheap homeowners insurance

Applying for cheap home insurance is much like applying for any home insurance policy. However, if finding a low price is your top priority, you should be aware of a few things:

  • Review your quotes for accuracy: You may think one company is cheaper than another, only to discover that your dwelling coverage or liability limit is significantly lower. To accurately compare quotes, make sure the coverage types and limits are as close as possible among companies.
  • Utilize discounts: If you’re getting quotes online, you may have to manually select which discounts to include on your quote. Make sure you read the descriptions and qualify for the discounts you are selecting.
  • Make sure the quotes meet or exceed mortgage requirements: Your mortgage may require you to carry a certain level of dwelling coverage, likely enough to pay off the loan if the home is destroyed or enough to rebuild the home. If your quote is cheap because your dwelling coverage is low, your policy might not meet your lender’s requirements. Insurance experts recommend you have enough coverage to provide financial protection for the full replacement value of your home, not just the mortgage payoff.

Once you have found a carrier from which you would like to buy a policy, you’ll likely have to fill out and sign an application. You may need to make at least a first month’s payment to start the policy unless your premium is paid from your mortgage escrow account, which is common if you have a mortgage on the policy. In that case, your insurance company will bill your mortgage lender for the full annual premium.

Eligibility requirements for cheap homeowners insurance

Many homeowners will qualify for cheap home insurance, but the cheapest policies are likely going to have a few things in common:

  • Clean claims record: Insurance claims generally increase your premium, so the fewer claims you’ve filed over the years, the less likely you are to see rate surcharges. You may even need to shop for new coverage because your policy was non-renewed due to claims frequency.
  • Proper home maintenance: Insurance companies are less likely to want to insure poorly maintained homes, as these homes could pose a higher risk of claims or significant damage. Many home insurers are focusing on the age and condition of roofs to determine the cost of coverage due to an increased level of storm claims across the U.S.
  • Low risk level: Homes with the lowest risk of damage — whether that’s from a fire, hurricane, tornado or other insurance peril — are likely to have the lowest premiums. Insurance companies charge more if there is a greater likelihood of a claim being filed due to natural catastrophe or other hazard.

That being said, most homeowners will be able to find the cheapest home insurance for their situation. Because premiums vary based on so many factors, the lowest price will be subjective. Understanding your needs and shopping around can help you compare rates.

Other factors to watch out for

Cheap home insurance can be a boon for your budget, but you also likely want to ensure you are purchasing adequate coverage. Skimping on coverage to save money could leave you in a perilous financial position if your home is damaged or destroyed in a covered loss. Working with an agent can help you feel at peace with your coverage decisions. You may also want to factor a company’s customer service and financial strength ratings into your decision to help ensure that you choose a company with a track record of “delivering on its promise” to its policyholders when a claim is filed.

Frequently asked questions

Methodology

Bankrate utilizes Quadrant Information Services to analyze 2021 rates for all ZIP codes and carriers in all 50 states and Washington, D.C. Quoted rates are based on 40-year-old male and female homeowners with a clean claim history, good credit and the following coverage limits:

  • Coverage A, Dwelling: $150,000, $250,000, $350,000, $450,000
  • Coverage B, Other Structures: $15,000, $25,000, $35,000, $45,000
  • Coverage C, Personal Property: $75,000, $125,000, $175,000, $225,000
  • Coverage D, Loss of Use: $30,000, $50,000, $70,000, $90,000
  • Coverage E, Liability: $300,000
  • Coverage F, Medical Payments: $1,000

The homeowners also have a $1,000 deductible and a separate wind and hail deductible (if required). Depending on your dwelling coverage limit, you may need to have a higher deductible.

Credit: Rates were calculated based on the following insurance credit tiers assigned to our homeowners: “poor, average, good (base), and excellent.” Credit tiers factor in your official credit-based insurance score but are not dependent on that variable alone. Three states do not allow insurers to use credit information as a rating factor in determining homeowners premium: California, Maryland and Massachusetts.

These are sample rates and should be used for comparative purposes only. Your quotes will differ.