Best homeowners insurance in New Jersey of 2021
Your home is likely one of the biggest financial investments you will ever make, and whether you are purchasing a starter home in Trenton or a retirement cottage along the Jersey Shore, you’ll likely want to protect your dwelling with the best homeowners insurance in New Jersey. According to Bankrate’s extensive research, Allstate, New Jersey Manufacturers, State Farm, Travelers and USAA are the best homeowners insurance companies in New Jersey.
According to Bankrate’s study of quoted annual premiums, the average cost of home insurance in New Jersey is $751 for $250,000 of dwelling coverage. Although this is significantly less than the national average cost of homeowners insurance, individual rates will depend on personal factors, such as location and age of the house and the type of coverage chosen.
Best home insurance companies in New Jersey
Bankrate found the best home insurance companies in New Jersey by analyzing the latest premium data from Quadrant Information Services, as well as each company’s available discounts and coverage options. Our team also analyzed third-party financial scores and customer satisfaction ratings from AM Best and J.D. Power, respectively.
Through our extensive analysis, Allstate, New Jersey Manufacturers, State Farm, Travelers and USAA came out on top.
|Home insurance company||Average annual premium for $250K in dwelling coverage||J.D. Power score|
|New Jersey Manufacturers||$355||Not rated|
*Not officially ranked with J.D. Power due to eligibility restrictions
While some other insurance companies take a low-touch approach to customers, Allstate operates local agencies throughout New Jersey. Allstate also makes the claims process easy, giving you the option to call their nationwide claims center, contact your local agent or file from your smartphone using the Allstate mobile app. Allstate also offers a wide range of discounts, which could dramatically decrease your premiums. You could earn discounts by setting up an automatic payment system, going claims-free, installing smoke or theft alarms in your home and even up to a 10% welcome discount just for switching to the homeowners insurance company from another insurer. However, Allstate’s premiums are the highest on our list.
Learn more: Allstate Insurance review
New Jersey Manufacturers
New Jersey Manufacturers (NJM) is a regional insurer that offers several discount options, including one for seniors and others for installing storm shutters and hurricane-resistant glass. You can personalize your homeowners insurance policy by adding endorsements, or riders, for identity fraud, mold and rot and increased personal property protection for expensive items such as furs and jewelry. However, NJM is not rated by J.D. Power.
Learn more: NJM Insurance review
State Farm has an A++ (Superior) rating from AM Best, which means State Farm is one of the most historically financially stable homeowners insurance companies in New Jersey. State Farm is also known for offering good home insurance coverage, affordable rates and helpful online resources where you can learn more about what your homeowners insurance policy covers. However, the homeowners insurance company has the second-highest premiums on our list.
Learn more: State Farm insurance review
Travelers offers the second-lowest premium on our list. In addition to low premiums, the company offers a wide range of discounts such as deals for green homes and being loss-free. There are additional coverage options such as coverage for jewelry and valuable items, identity fraud and a personal articles floater. However, before buying, you may want to consider that Travelers received the lowest J.D. Power customer satisfaction rating on our list.
Learn more: Travelers Insurance review
USAA provides comprehensive homeowners coverage. The company usually ranks among the best New Jersey home insurers, but is only available to active military members, veterans and their eligible family members.
Learn more: USAA Insurance review
How much is homeowners insurance in New Jersey?
The average premium cost for a homeowners insurance policy in New Jersey is $751 for $250,000 in dwelling coverage per year. This is 43% less than the national average of $1,312, making New Jersey one of the more affordable states for homeowners insurance. It is especially affordable when compared to neighboring state New York’s average rate of $969 per year, and while it is more expensive than Delaware, it is about on par with the average Pennsylvania rates at $730 annually.
Home insurance in New Jersey
New Jersey is prone to severe weather impacts year-round. In the summer, the potential of strong hurricanes can negatively impact insurance premiums, particularly in Jersey Shore communities. In the winter, nor’easters and other severe storms due to catastrophic winds and the heavy weight of snow and ice buildup can cause property damage to the roofs of homes. Tornadoes are also prevalent in New Jersey in the spring, summer and fall.
Common causes of loss in new Jersey
Common property losses that are typically seen with home insurance claims in New Jersey include:
- Storms and hurricanes: As a coastal state that is in the direct line of impact of any hurricane moving up the east coast, home insurance losses due to wind and water damage are common. New Jersey residents can use FEMA’s Flood Map Service Center to find out if they live on a flood plain and if they might either need or want flood insurance.
- Wildfires: Wildfires can impact those who live in more rural or heavily wooded areas of the Garden State. An average of 1,500 wildfires a year damage forests and the homes that are near them. This is especially true for those in the northern part of the state or the region of the Pine Barrens, where fires can spread quickly because of dry underbrush.
- Snow: New Jersey is snowier than 26 other states in the country, according to the World Population Review. Snow can cause water damage, flooded basements and more.
- High winds: New Jersey sometimes experiences high-wind events, which can cause power outages and other issues. Protecting yourself financially against potential windstorms may be smart.
Fortunately, New Jersey is not a high-risk state for earthquakes, although small tremblers occur occasionally. The most severe earthquake ever recorded in the state was a 4.8 quake in 1938. New Jersey is also far from “Tornado Alley” in the Midwest, but occasionally experiences tornado outbreaks, including in July 2021 in areas near the Delaware River.
Home insurance coverage options in New Jersey
As a coastal state, New Jersey sits perched on the Atlantic Ocean, leaving it vulnerable to specific risks.
- Flooding: New Jersey has nearly 500,000 properties that have a 26% chance of experiencing extreme flooding within the next 30 years, according to non-profit foundation Flood Factor. If you’re a homeowner in New Jersey, you may want to check if flood insurance is required in your home’s area.
- Sewage backup: According to New Jersey’s Department of Environmental Protection, excessive rain or snowmelt can overwhelm the capacity of sewer pipes and result in an overflow of untreated sewage and stormwater. You may want to consider sewage backup coverage to ensure you’re financially prepared in the event of standing water or sewage backup in your home.
- Identity theft: The highest portion of reports filed to the Federal Trade Commission in 2020 were for identity theft. With financial crime through identity theft on the rise, some homeowners may want to add on identity theft coverage to their homeowners insurance policy.
Frequently asked questions
What is the cheapest homeowners insurance in New Jersey?
Home insurance rates are subjective because factors such as location and construction can greatly affect premiums. To find the cheapest homeowners insurance in New Jersey, determine the amount of coverage you need and then shop around for the best combination of value and protection.
Is home insurance in New Jersey expensive?
Home insurance for a $250,000 dwelling in New Jersey costs an average of $561 less annually than the national average, at $751 per year. However, keep in mind that your individual home insurance premium will vary based on individual characteristics.
How much personal liability coverage should I purchase?
Consider the specific features of your home when determining how much personal liability coverage you need. For example, if you own a swimming pool and like to host pool parties, you probably need additional liability coverage in case someone sustains an injury on your property. When requesting insurance quotes, pay close attention to standard liability coverage amounts. Typically, standard coverages range from $100,000 to $500,000.
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 windstorm and hail deductible (if required).
These are sample rates and should be used for comparative purposes only. Your quotes will differ.