For Consumers

How do insurance companies set homeowner rates?

  Important: As of June 20, 2021, insurers cannot use your credit scores to determine how much you pay for auto and homeowners insurance. If your company is charging you more, shop around. Companies have used credit scoring for two decades, so now is the best time to find a better deal.

Insurance companies consider many factors when setting homeowner rates. Understanding how this affects your premiums - as well as shopping around - can save you money. Rate-influencing factors include:


Rates vary based upon where your house is located. Crime, wind damage and other risks vary by geographic area.

Construction type

Rates vary based on the type of construction. For example, a wood vs. a brick home.

Amount of insurance

Your premium will vary depending on the replacement cost of your home. The cost to actually rebuild your home may exceed its current market or sales price.

Talk to your agent or company to see if you have the right amount of coverage.

Claims history

Some companies may charge you more based on the number or types of claims you file. They may even cancel your coverage due to one or more claims.

Ask your agent or your company how they treat claim history.