Jennifer Rudden
Research Lead Financial Services & Real estate
Homeowners insurance in the United States - statistics & facts
Homeowners insurance is a form of property insurance designed to protect a home—or possessions in the home—by providing financial reimbursement to the owner in the event of damages or theft. Homeowners insurance may also provide liability coverage against accidents in the home or on the property. The most affordable states for homeowners insurance in the United States include Hawaii, Delaware, and Vermont.
How does homeowners insurance work?
In the United States, most home buyers borrow money in the form of a mortgage loan and the buyer must have homeowners insurance before a lender with grant the loan. Homeowners insurance was first introduced into the U.S. market in the 1950s and, in the past three decades, the U.S. has maintained a homeownership rate of above 60 percent. Before then, a homeowner would have had to purchase separate policies covering the various individual perils that could affect a home. Seven forms of homeowners insurance, ranging in name from HO-1 through HO-8, have now become standardized in the U.S., with each offering a different level of protection. The average premium for homeowners insurance in the U.S. currently stands at over 1,000 U.S. dollars.Who leads the homeowners insurance market?
The perils covered by property insurance typically include home or property loss, theft or damage caused by fire, smoke, wind, ice, hail, snow, or lightning. The total incurred losses for homeowner insurance in the U.S. amounted to over 65 billion U.S. dollars in 2021. Some of the leading writers of homeowners insurance in the U.S. include State Farm, Allstate, USAA Insurance Group, and Liberty Mutual. State Farm is the market leader of the homeowner insurance sector in the U.S., with a market share of around 18 percent of the industry in 2021. In the United States, some “acts of God” events—such as floods, hurricanes, typhoons, and earthquakes—as well as “acts of war” such as terrorism, insurrection, or a nuclear attack, are typically excluded from homeowner insurance policies.
