How Much Is Homeowner's Insurance?

Homeowners Insurance - The Factors In Cost
The first thing to remember about homeowner's insurance is the factors that determine cost:
1. Overall square footage of the dwelling and real property
2. Number of occupants
3. Location
4. Value of furnishings, exterior additions like a detached garage, gazebo, swimming pool, hot tub or outdoor kitchen
5. Any additional items the homeowner intends to insure

Home Insurance Cost Factor #1: Overall Square Footage Of Dwelling and Real Property

The larger the dwelling and real property are, the higher homeowners insurance costs may be. When choosing homeowners insurance, check with the agent on variables that affect cost when the policy is based upon overall square footage.

Home Insurance Cost Factor #2: Number of Occupants

In terms of fire, flood and other damages that can occur to a home or property, the number of occupants of the dwelling is also a factor in some homeowner insurance policies. It's important to read the terms and conditions of the policy before approving it. If something in the policy is unclear, don't be afraid to discuss it with your agent, particularly when cost is affected.

Home Insurance Cost Factor #3: Location, Location, Location

The location of a dwelling and real property affects the cost of homeowner insurance. As an example, a city dwelling with frontage nearest to shopping centers and high volume traffic may affect the insurance costs. Whereas, dwellings on cul-de-sacs and in large private developments may not be a significant cost factor. In some areas, higher homeowner insurance costs are a result of affluence within residential communities.

Home Insurance Cost Factor #4: Value of Possessions and Property

Value of furnishings, exterior additions like a detached garage, gazebo, swimming pool, hot tub or outdoor kitchen can also add cost to homeowner insurance policies. This is relevant to the cost should damages occur and result in claims against the insurance policy.

The Cost of Homeowner's Insurance

The cost of homeowner insurance is dependent upon specific factors covered by the policy. As an example, the cost to insure a 1200 square foot dwelling in a rural area may be less expensive than a 33,000 square foot dwelling in an exclusive, upscale area. Cost may also be determined by property tax rates in some locations.