Best homeowners insurance in Colorado of 2021
Outside of its picturesque landscapes and popular cities like Denver and Colorado Springs, Colorado is also known for its harsh weather, including hail, snow and even wildfires. Because of these hazards, homeowners insurance can be particularly beneficial in reducing extensive out-of-pocket losses. Homeowners insurance costs Colorado residents $1,659 per year on average for $250,000 in dwelling coverage.
In 2019, Colorado had 120 days of severe hail, according to the National Insurance Crime Bureau (NICB) in its 2020 Hail Report. That same year, Colorado residents made more than 69,700 hail claims, the second-highest number of claims made by any state. While home insurance is not required in the state of Colorado, most mortgage lenders require some sort of insurance to protect the amount of money owed on the loan. As part of Bankrate’s endeavor to monitor the homeowners insurance market, we assessed multiple Colorado insurers based on 2021 average premiums, customer satisfaction scores and current policy offerings. To help jumpstart your insurance search, we selected five standouts that represent some of the best homeowners insurance companies in Colorado.
Best home insurance companies in Colorado
Based on our methodology and information gathered from the 2020 J.D. Power U.S. Home Insurance Study, Bankrate gathered the top five homeowners insurance companies (by market share) in Colorado. We took into account premium costs, coverage options, customer ratings and more to choose these providers.
|Home insurance company||Average annual premium for $250K liability||J.D. Power score|
|Allstate||$1,952||829 / 1,000|
|American Family||$1,434||821 / 1,000|
|State Farm||$2,232||829 / 1,000|
|*USAA||$1,310||889 / 1,000|
*Due to membership eligibility restriction, J.D. Power is considered rank-ineligible by J.D. Power.
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 a 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.
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 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). You may also qualify for discounts for everything from having a smart home to renovating your home, to loyalty discounts, bundling discounts and new homeowner discounts.
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 company provides specialized options to insure luggage, fundraising money and credit card fraud. Firefighters and law enforcement officers can also benefit from 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 NFIP policies directly through them.
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. 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.
USAA consistently earns high scores across J.D. Power studies and AM Best ratings, 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. Colorado residents who are either members of the military or relatives of one will be able to take advantage of USAA’s 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.
Average cost of homeowners insurance in Colorado
The average cost of Colorado homeowners insurance annually is $1,659 for a dwelling coverage limit of $250,000, which is a few hundred dollars above the annual national average cost of home insurance of $1,312. Colorado’s typical weather conditions, including snow and hail storms, are likely responsible for the state’s higher premiums.
While Colorado is one-fourth of the United State’s Four Corners, its neighboring states that make up the remaining corners have lower annual home insurance premiums on average. This includes Utah, at an average of $647 per year, and Arizona, at an average of $1,189 per year.
However, your yearly cost will vary among providers depending on a number of factors, from the age of your home to your credit rating. Even the distance of your home from a fire hydrant can make a difference in your premium costs.
Home insurance considerations 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 a home 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 considering homeowners insurance options in Colorado, it is important to account for typical weather conditions and their associated risks, among other important variables.
Colorado common causes of loss
The best home insurance companies in Colorado takes into account the state’s weather patterns, which are the cause of many claims. Other considerations include the likelihood of destructive wildfires, three of which made Colorado history in 2020 for being the largest to date. Here is how to account for some of these concerns:
- Water damage: Water damage caused by flooding is particularly common in the spring months, when melting snow causes rivers 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 available from the government. 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 if you’re at risk of flooding.
- Hail damage: Along with winter snow and spring thaw comes hail. Colorado ranks second in the nation for the number of hail loss claims on homeowner insurance, according to the Insurance Information Institute. It also ranks in fifth place 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 roof, gutters and windows. Some insurance companies may exclude coverage for cosmetic damage caused by wind or hail, so be sure to speak with your provider to confirm what is covered under your policy.
- Fire: Nationally, fire and lightning damage is one of the most expensive claims made to homeowners insurance policies. Since wildfires are not uncommon in Colorado, many homeowners are at risk of damage due to fires, especially those who live in rural or forested areas. In fact, as wildfires increase in the western United States, it is becoming harder for homeowners to find reasonably priced insurance. Removal of fire hazards and other fire mitigation techniques can help make some homes more insurable.
- Theft: Colorado is not a high-ranking state for home theft, and nationally, property crime rates have been slowly dropping, but theft is still 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 ensure that you do not need to make a claim on your policy related to theft.
Home insurance coverage options in Colorado
Fortunately, most standard homeowners insurance policies include coverage for theft, structural damage from hail, and fires, including wildfires. 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 basic policy. Some of your options include:
- Flood insurance: This coverage helps pay for resulting damage to your home’s interior structure or personal belongings due to flooding. This coverage does not come standard and must typically be purchased separately from a government or private flood insurance provider.
- 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 interest in music may find it helpful to add increased coverage for their musical instruments. Many providers like Allstate and Nationwide offer this optional coverage.
- Water backup coverage: This coverage is commonly used among homeowners as sewer and sump pump backups can happen at any time. Though water backup coverage is optional, you should weigh its costs against potential out-of-pocket expenses for water damage occurring within your home or to your belongings.
Frequently asked questions
What is the cheapest homeowners insurance in Colorado?
The cheapest homeowners insurance for you will depend on a number of factors, including the value of your home, the area in which you live, your credit score, your deductible and what discounts you qualify for.
How do I get homeowners insurance in Colorado?
Once you know how much your home is worth, you can obtain an online quote from an insurance provider. You can utilize the Department of Insurance Colorado as a reference guide to any homeowners insurance questions you have that are particular to the state of Colorado.
What do I need to do to obtain a quote for homeowners insurance?
The information that each insurance provider requires varies, but most companies require you to provide some personal information like the address and value of your home.
Does flood insurance come with my homeowners insurance policy?
No, flood insurance is typically separate from homeowners insurance. If this is something you’re interested in or if it is required, talk to your insurance agent about what flood insurance is, what it covers, and how you can purchase the coverage to protect your home.
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: $250,000
- Coverage B, Other Structures: $25,000
- Coverage C, Personal Property: $125,000
- Coverage D, Loss of Use: $50,000
- 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).
These are sample rates and should be used for comparative purposes only. Your quotes will differ.
Why trust us
Bankrate demystifies the insurance industry by making it easier to find insurance information. Regardless of where you are in your journey, Bankrate helps you make informed decisions.
We use two key sets of customer priorities to evaluate insurance carriers and help you decide what to consider:
First: we evaluated customer satisfaction and complaints, financial strength and stability and overall costs based on average rates quoted to real drivers.
Second: we evaluated customer experience by assessing each provider’s customer service options through online capabilities and agent accessibility.