How Bankrate chose the best home insurance companies in Colorado
Choosing the best homeowners insurance in Colorado started with reviewing all the largest insurance carriers by market share. From there, Bankrate’s team of insurance experts used a series of key metrics to assess companies, including average premium data from Quadrant Information Services, policy options and discount opportunities, third-party ratings by rating agencies and more.
To help summarize our findings, we rated each company with our Bankrate Score. The better a company performed in each of these metrics, the higher its overall Bankrate Score for a maximum score of 5 out of 5. As you read through our picks for the best home insurance companies in Colorado, our Bankrate Score can help you quickly compare different carriers to see which might work best for you.
- USAA, Allstate and State Farm offered some of the cheapest average home insurance rates in Colorado.
- Fire, water damage and hail damage are three of the most common hazards Colorado homeowners may face.
Best home insurance companies in Colorado
Based on our methodology, average premium data from Quadrant Information Services and information gathered from the 2021 J.D. Power U.S. Home Insurance Study, Bankrate assessed the top five Colorado homeowners insurance companies (by market share). We found USAA, State Farm and American Family to be among the best home insurance companies in Colorado.
|Home insurance company||Bankrate Score||Average annual premium for $250K dwelling coverage||J.D. Power score||AM Best Rating|
|California Casualty||Not rated||$1,933||N/A||B+|
*Due to its membership eligibility restriction, USAA is considered rank-ineligible by J.D. Power.
Best for: Numerous discount and reward opportunities
Colorado homeowners looking for coverage that comes with additional rewards may find Allstate to be an excellent choice. For example, you could earn a 5% discount on your premium each year you go without filing a claim, or even get $100 off your deductible by the same criteria. If you do file a claim, adding Allstate’s RateGuard option to your policy upfront will prevent rate increases for qualifying circumstances. Aside from standard homeowners insurance coverages, there are also special home-sharing options to help cover you from damage or theft when renting your property. However, compared to the other carriers on this list, Allstate received the lowest customer satisfaction scores from J.D. Power.
Learn more: Allstate Insurance review
Best for: Various add-on coverage options
Experts often recommend creating a home inventory to determine your coverage, which American Family makes easy with its downloadable worksheet. Once you have a better idea of the financial protections you might need for your home, you can choose from numerous coverage options like water backup, service lines and credit theft to round out your coverage. Because hail and resulting damage to vinyl or metal siding may be more common in Colorado, American Family’s matching siding coverage may be especially helpful as it replaces the undamaged siding as well (in case the original siding was discontinued). However, American Family earned an A rating for financial strength from AM Best, which was lower than some of comparable national home insurance carriers.
Learn more: American Family Insurance review
Best for: Individuals working in public safety and education fields
California Casualty provides policies catering to those in fields of public safety and education, including firefighters, nurses and teachers. In addition to basic coverage, the regional insurer provides specialized options to insure luggage, fundraising money and credit card fraud. Firefighters and law enforcement officers can also benefit from its unique turnout gear coverage, while attending to one of the Centennial State’s seasonal wildfires. California Casualty also makes preventing financial losses from other sorts of damage easy, such as allowing policyholders to purchase FEMA’s National Flood Insurance Program policies directly through them. However, California Casualty received the lowest financial strength rating of all companies on this list from AM Best and its customer satisfaction was not rated by J.D. Power.
Learn more: California Casualty Insurance review
Best for: Highly rated customer service
State Farm is the most popular insurer across Colorado, with 19.5% of Colorado’s homeowners insurance market share. The company’s strong customer satisfaction rating and mobile app, which make filing a claim easy, help solidify its popularity among homeowners. State Farm’s average premium is the most expensive on this list, and doesn’t offer as many discount opportunities as other companies. The company’s Simple Insights blog offers comprehensive articles on home maintenance, buying and selling your home and homeowners insurance — a great resource, especially if you are new to the world of insurance.
Learn more: State Farm Insurance review
Best for: Military-centric home insurance coverage
USAA consistently earns high scores across J.D. Power consumer satisfaction studies, as well as strong financial strength ratings from AM Best, in part due to its customer service skills and simple claims process that can be completed either by phone or mobile app. However, membership and coverage is only extended to active or retired U.S. military service members and their families. Colorado residents who are either members of the military or eligible relatives of someone who is active-duty or a veteran, will be able to take advantage of USAA’s many coverage options, including those specific to military uniforms and home sharing, among other standard coverages. And even with these specialized coverages, USAA offers one of the cheapest homeowners insurance premiums in Colorado.
Learn more: USAA Insurance review
How much is homeowners insurance in Colorado?
The average cost of Colorado homeowners insurance is $1,863 per year for a dwelling coverage limit of $250,000. That is significantly higher than the annual national average cost of home insurance, which is $1,383 per year. Colorado’s average cost of home insurance is higher than the neighboring state of Utah, where homeowners pay $668 per year on average for $250,000 in dwelling coverage, and is also higher than the average annual cost of homeowners insurance in Wyoming, which is $902 per year for the same dwelling limit. Colorado’s volatile weather conditions, including snow and hail storms, are likely responsible for the state’s higher premiums.
Your yearly cost for property insurance coverage will vary among home insurers depending on a number of factors, from the age of your home, your claims history and your credit-based insurance score. Even the distance of your home from a fire hydrant and fire station can make a significant difference in your premium costs, according to the Insurance Information Institute (Triple-I).
Home insurance in Colorado
As with any state or city, the unique aspects of where you live will likely have a large impact on how you go about choosing the best Colorado homeowners insurance company. For example, someone living near Snowmass may have very different considerations than someone living near Denver to account for weather and cost of living. When assessing Colorado homeowners insurance options, it is important to account for typical weather conditions and their associated risks, among other important variables.
Common causes of loss in Colorado
The best home insurance companies in Colorado take into account the state’s unpredictable weather hazards, which are the cause of many property claims. The state has also incurred a very active 2021 wildfire season. Here is how to account for some of the common perils that impact Colorado homeowners:
- Water damage: Water damage caused by flooding is particularly common in the spring months, when melting snow causes rivers, lakes and ponds to overflow. This is why most experts recommend that you consult with your insurance agent about the advisability of flood insurance, even if you do not live near a large body of water. Flood insurance is underwritten by FEMA’s National Flood Insurance Program (NFIP) and is also offered by many private flood insurers. You can find out if you live in a flood-prone area by checking out FEMA’s Flood Map Service Center, which allows you to input your address and find out your flood risk. The Triple-I recommends all Colorado residents consider purchasing flood insurance as 90% of U.S. natural disasters involve flooding.
- Hail damage: According to the Triple-I, Colorado ranks second in the U.S. for the highest volume of hail claims filed by homeowners. It also ranks fifth for the number of “major hail events,” which refers to hail storms where the stones are one inch in diameter or larger. Hailstones, especially larger ones, can cause significant damage to your home’s roof, gutters and windows. Some insurance companies may exclude damage caused by hail, so be sure to speak with your agent or insurer to confirm what your policy covers.
- Fire: Fire and lightning damage generate expensive homeowners insurance claims. Since wildfires occur frequently in Colorado, homeowners are at risk of fire damage, especially those who live in rural or forested areas. As wildfires increase in the western U.S., it is becoming harder for homeowners in states like Colorado to find reasonably priced insurance. Removal of fire hazards and other fire mitigation techniques can help make some homes more insurable.
- Theft: Regardless of where you live in the U.S., theft is something that homeowners, especially those in urban areas, should be aware of and ward against. Strong window and door locks and other security measures can help protect your home and reduce the risk of filing a theft claim.
Home insurance coverage options in Colorado
Fortunately, typical standard Colorado homeowners insurance policies include coverage for theft, hail damage and fire damage. However, other potential causes of damage may not be included and require an endorsement or additional policy. To better protect your financial investment in your Colorado home, it may be worth considering adding coverage that extends past your standard policy. Some of your options include:
- Flood insurance: Coverage helps pay for resulting damage to your home’s interior structure or personal belongings due to flooding. This coverage must typically be purchased separately from NFIP or a private flood insurer.
- Musical instrument coverage: Colorado is known for a few of its music scenes, such as in Denver and Red Rocks. Colorado homeowners who also take an interest in music may find it helpful to add increased coverage for their musical instruments. Many property insurers, including Allstate and Nationwide, offer this optional coverage.
- Water backup coverage: Sewer and sump pump backups can happen at any time. Though water backup coverage is optional, you should weigh its additional premium cost against potential out-of-pocket expenses for water damage occurring within your home or to your belongings.
Frequently asked questions
- Largest home insurance companies
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- How much does flood insurance cost?
- Homeowners insurance for people with bad credit
- Does homeowners insurance cover plumbing?