How much is homeowners insurance on a $400,000 house?

How much is homeowners insurance on a $400,000 house?

The average home insurance cost for a $400k house is $3,231 a year. That's for a policy with $400,000 in dwelling coverage, $300,000 in liability coverage and a $1,000 deductible. The average home insurance cost varies not only based on the dwelling coverage, which is the replacement cost of the home but also based on factors like the state where you live. Home insurance rates by state differ quite a bit.

If you paid $400,000 for your home but the replacement cost is higher or lower, your home insurance rate will also be higher or lower. For example, if your purchase price was $400,000, but the calculated replacement cost is $500,000, you'll have to buy homeowners insurance in that amount, raising your premiums. While a replacement cost estimator can give you a ballpark for the right coverage level, a full replacement cost calculation is vital to get the right coverage.

A home insurance calculator can help you see how much coverage will cost based on the coverage you need.

Average cost of homeowners insurance on a $400,000 home by state

Take a look at the average cost of home insurance for a $400K home by state, based on $400,000 of dwelling coverage, $300,000 of liability and a $1,000 deductible.

Homeowners insurance on a $400,000 home by company

Based on a recent data analysis, Allstate offers the cheapest homeowners insurance at $2,470 a year for a $400K dwelling coverage without a hurricane deductible. However, American Family offers the cheapest home insurance at $3,035 per year for $400K dwelling coverage, along with a 2% hurricane deductible if you live in a hurricane-prone area.

Home insurance rates vary depending on the company you choose, along with other factors. What’s the cheapest home insurance company at $400,000 in dwelling coverage? Take a look at rates from some of the best home insurance companies below.

Homeowners insurance on a $400,000 home by liability level

The dwelling coverage amount has far more impact on your rates than how much liability you have, which is a good argument for increasing your home insurance liability limits. Take a look at the difference in rates with $100,000 or $300,000 in liability.

Homeowners insurance on a $400,000 house by credit rating

Your credit rating affects home insurance rates more than you’d think. There are only a handful of states where using credit isn’t allowed. Here’s a look at homeowners insurance premiums for a $400,000 policy by credit rating. 

How much coverage do I need for a $400,000k home?

If you paid $400,000 for your home, that’s not necessarily the amount of home insurance coverage you need. To determine the right coverage limits, you will need to calculate the replacement cost of your home. That’s how much it would cost to rebuild the home, and may be more or less than the home’s market value.

Replacement cost is calculated by home insurance companies based on the square footage of your home, its age and all of the features of the home, including construction materials inside and out. If your home's replacement cost is $400,000, then that's the amount of coverage you need. In other words, if you paid $400k for your house, that doesn't mean you need $400k in coverage; you may need more or less than the purchase price. You'll also need to consider what your mortgage lender requires for coverage.

You will also need to consider your personal property. Personal property coverage is set as a percentage of your dwelling coverage, usually 50% to 70%, on standard homeowners insurance policies. However, it's important to carefully consider the value of your property and increase this coverage if needed. Be aware that this will increase your homeowners insurance costs.

What does $400,000 in dwelling coverage actually cover?

If your policy has $400,000 in dwelling coverage, that is the maximum that the policy will pay for damage to the structure of your home.

Your policy may pay more if you have one of the following endorsements:

• Extended replacement cost, which adds a specified percentage to the dwelling coverage. If you have 125% extended replacement cost on a policy with $400,000 in dwelling coverage, your total available coverage is $500,000, or an additional 25%.
• Guaranteed replacement cost, which guarantees the home will be rebuilt regardless of how much over the limit it goes.

Your dwelling coverage doesn't include coverage for your personal property, although it does influence it. Personal property coverage is usually set at 50% to 70% of the dwelling coverage.

What property features affect home insurance rates for a $400K home?

All of the features of your home affect home insurance rates. They contribute to the calculation of your home's replacement cost and will have already been considered if your homeowners insurance company says your replacement cost (dwelling coverage) is $400k.

However, there are some factors outside of the features that affect replacement cost that will also impact average home insurance costs. These include:

• Proximity to a fire station or hydrant
• Attractive nuisances like a pool or trampoline
• Risks on the property like brush, especially if you live in a high-risk area for wildfires
• Safety and security systems

How to get lower homeowners insurance on a $400k home

The best way to get a good price on home insurance is to shop around and compare rates from as many companies as possible. Here are a few other tips for cheaper home insurance premiums:

• Ask about home insurance discounts
• Bundle your home and auto insurance
• Raise your deductible

Don't reduce your coverage to save money. While underinsured your home might save you money, it will cost a lot more if you have to file a claim. 

Methodology

Insurance.com commissioned Quadrant Information Services to get homeowners insurance rates for $400,000 in dwelling coverage, $300,000 in liability, a $1,000 deductible, and a 2% hurricane deductible in 20 states. To get these rates, we have compared 20,739,560 insurance quotes across 34,588 ZIP codes from 62 company groups. The rates are for comparison purposes only, your exact rates may vary.

Frequently asked questions: Homeowners insurance on a $400K home

How much is home insurance a month for a $400,000 house?

The average cost of home insurance per month for a $400k house is $269. Your monthly cost isn't always a direct division by 12 of the annual premium, however, since there may be fees for making payments or discounts for paying in full upfront.

Many people pay their home insurance as part of their monthly mortgage payment; the mortgage company pays it annually from an escrow account and then charges you monthly.

How much is homeowners insurance on a $400,000 house in Texas?

The average cost of home insurance for a house with $400,000 in dwelling coverage in Texas is $4,744 a year. That's with $300,000 in liability coverage and deductibles of 2% of hurricanes and $1,000 for all other perils.

Does how much I pay for my house affect the cost of home insurance?

While home market value doesn't directly affect how insurance is priced, higher-value homes generally have higher replacement costs. In general, you will pay more to insure a million-dollar home than a $400,000 home, because a more expensive home is usually larger and has higher-end construction materials inside and out.

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