How Much Does Homeowners Insurance Cost in New York?
Homeowners insurance pays to repair or reconstruct your home if it has been damaged or destroyed by natural disasters covered in your policy.
This includes fire, hurricane, hail, lightning, and more.
Your policy does double duty and pays for personal belongings inside your apartment or house too.
If your valuables are stolen or if they have been destroyed by insured disasters, homeowners insurance will pay for these items as well.
As a homeowner, that means an extra added expense toyour mortgage payments, taxes, utilities, and any other HOA fees.
So, it is affordable, and do you even need it?
What is the Average Cost of Homeowners Insurance in New York?
|Average Yearly Cost||$950|
|Average Monthly Cost||$79.17|
|Average Weekly Cost||$18.25|
According to the Homeowners Insurance Report by the National Association of Insurance Commissioners (NAIC), the average cost of homeowners insurance in the United States is $1,211.
The average annual homeowner's insurance premium in New York is $950.
You’d think New York would be higher than the national average as the cost of living and real estate tend to be higher than the national average.
But statewide, a homeowners insurance policy might cost more because most people live in houses and their square footage is typically higher than the square footage of an apartment in NYC.
How Much Is Homeowners Insurance In New York Going to Cost You?
At least homeowners insurance in New York is slightly cheaper in comparison to the nationwide average.
The cost in New York is $1,188 based on the median home value in New York City, which is $652,307, according to Insurify. And, according to Policygenius, the average insurance nationwide cost is $1,633.
However, in New York, your insurance may end up costing you a lot more than what other cities around the nation pay. Why?
We’ll give you the lowdown on homeowners insurance, including what it covers and what it doesn’t, how to get the best quote on a policy, and the different riders you may want to add to your insurance.
The Cost of Home Insurance Can Vary Significantly
Here is the average annual cost of homeowners insurance in New York State via LendingTree.
NYCM and State Farm have the lowest rates.
However, and as we reminded you, rates vary from property to property.
Just because it lists the average rate to be $529, you can still get quoted closer to $900, which is significantly higher.
For affordable coverage, the following home insurance providers are the cheapest in New York City.
But before you begin to drool, we did our research and figured out that the cost is actually around the $800 level for a standard policy.
Traveler’s Insurance is topping out at around $900, making this the most expensive rate.
And it seems MetLife is at the top of the list, offering the cheapest policy in the city.
At $742 a year, you can add on riders to protect your valuable possessions and increase your rates for more protection without much of a bump in terms of price.
Most Popular Homeowners Insurance Companies
The largest homeowners insurance policy in New York actually has great customer service and customer satisfaction. According to J.D. Power, it received a 3/5 overall rating. We suspect that the (below) average rating is due to Allstate’s rates that are wildly more expensive than other insurers covering New York.
Allstate’s rate is $1,443 a year, which is $200 above the state average.
USAA Insurance covers jewelry lost to fire or theft.
USAA’s coverage limit for jewelry is $10,000, just like other traditional homeowners insurance policies. If you want additional jewelry coverage, you have to take out a separate policy.
That policy is called Valuable Personal Property, which will pay for a replacement diamond if it falls out of your ring or if it is accidentally broken during a repair. The added coverage also includes musical instruments and fine art.
There is no deductible. And there is no need for an appraisal for any piece of jewelry that is insured for $15,000 or less.
State Farm is a popular option because of their low rates on standard coverage in New York.
The annual rate is $855, which is actually 31% below the median for homeowners insurance across all states.
State Farms also received 4/5 in J.D. Power’s 2019 home insurance study and is the most affordable coverage in the city.
Farmers Insurance covers expensive goods if there is theft or fire. But accidental damage is not covered.
Still, Farmers do offer riders to cover that Cindy Sherman still shot and the deductible is left to you. Just be sure you have proof of purchase, as Farmers need from you a receipt or an appraisal for each and every item you wish to insure.
Geico’s standard homeowner's insurance policy limits personal property coverage to $500 and up to $2,000. But Geico also has a rider to increase your coverage.
Geico and Allstate offer comparable options. Standard policies limit personal property coverage to $500 to $2,000 at Geico and $1,000 to increase the amount of coverage and cover loss and damage not covered by the main policy.
NYCM is a small insurance company that has been around for New York City residents since 1899. If you’re going cheap, NYCM maybe your best option. The average cost for insurance is a very low at $529.
Which is Better: Local or National Homeowners Insurance Company?
Should you choose a local policyholder or a statewide one?
Many reviews we found online, as well as information we received from The Homeowners Insurance Guide, find there is no debate when choosing national insurance vs. local insurance.
National Insurance companies don’t really know you even if you’ve given them all your info to qualify for one of their policies. They are often bureaucratic machines.
A local insurance company and its agents will know exactly where the fire station is in your area.
It all comes down to not just being familiar with the neighborhoods but also the types of properties in your area, the topography, climate, and conditions that can affect your estimate.
Why a Local Agent Matters
The ideal agent of your policy is someone who works and lives nearby, knows your community, and can be accountable when a crisis strikes.
In addition, a local insurance company will know the best deals to take advantage of and have a real-life understanding of the risks you face in your area.
They give you personalized, bespoke service to homeowners, especially when you are making a claim.
Because they know your community, they are more able to give you a better quote than national companies.
The customer service that comes with a local insurance agent is unparalleled. In fact, many homeowners end up developing a strong, personal relationship with their local agent.
National policies feature faceless agents.
What is Homeowners Insurance?
Homeowners insurance covers losses and damages to a homeowner’s apartment and the items in it.
The bare-bones policy—also known as a traditional or standard policy—mostly pays for interior damage, exterior damage, the loss, theft, or damage to personal effects that range from a $2,000 laptop to a pricey engagement ring—but only up to the limit.
The policy also covers any injury that occurs while in the apartment.
Your premiums rate is contingent on the condition and size of your apartment, the style in which it was built, your location, and your credit and claims history.
We’ll explore these in more detail ahead.
Is Home Insurance Necessary Coverage?
While it isn't the law to own home insurance in New York, your mortgage company will require you to purchase this coverage.
No mortgage lender will give you a loan commitment if you fail to buy insurance.
You need to purchase a policy at closing in order to close on your loan.
Once you get over the sticker shock, insurance can help you a lot.
It can protect your condo and your personal possessions in your condo in case of damage or loss due to theft or vandalism. It can even cover cases of liability or bodily damage.
Should You Consider the Deductibles on Your Home Insurance Policy?
As is the case with other types of insurance, any loss would be subject to a deductible. However, the amount of the deductible will be established at the time you take the policy.
A deductible is basically the amount of money you’ll need to pay when making a claim.
Here’s an example. Say you have a $1,000 deductible and make a claim for $10,000 worth of damage to your property.
Your homeowner's insurance will cover $9,000 and you’ll have to pay $1,000 out of your own pocket.
Another example is if you have a $500 deductible.
If you have $500 worth of damage in your co-op or condo due to a fire, your policy won’t pay a single dollar.
Instead, you have to come up with the money for any repairs.
In this case, homeowner insurance experts say you shouldn’t even bother filing a claim.
How Much is a Homeowners Insurance Deductible?
Deductibles usually come in the amounts of $500, $1,000, $1,500, $2,000 and $2,500.
You can choose to take a high or low deductible, depending on how much you want to pay for the policy.
But don’t try to save money by getting the lowest possible deductible.
Because if you choose to select a higher one, the price of your premium will be lower.
Key takeaway: the higher your deductible, the lower your rate.
There are several insurance companies that serve New York, and since rates for each will vary, you are bound to come up with a policy that has a price you can afford after comparing rates.
What's Covered and Not Covered Under Home Insurance?
Here’s what a standard home insurance company covers.
Certain Natural Disasters Are Covered
If your apartment is damaged or destroyed by fire, hurricane, hail, lightning, or other natural disasters, your policy will pay to rebuild or repair your home.
Personal Belongings are a Part of Basic Coverage
Your interior belongings that are stolen or destroyed by natural disasters such as fire and hurricane will be covered by your policy.
But watch out.
This is for basic coverage, and your policy will only pay up to your limit.
Additional Living Expenses
Additional living expenses (ALE) kick in if you have to go to a hotel because your apartment is unhabitable due to severe damage from insured disasters.
Your policy will even pay for things like your restaurant meals or other essential living expenses until your apartment is safe to enter after a rebuilt.
But keep in mind that the rebuilt only goes up to your policy limit as well and, if it’s low, you may have to pay out-of-pocket to complete the repair of your home.
Highly Valuable Items in Your Home
If you have valuables such as expensive jewelry, high-tech, high-worth computers and other business equipment such as a professional-level copy maker combo fax, generally your homeowner’s insurance will cover these items.
What's Not Usually Covered By Home Insurance?
Home insurance doesn’t cover all perils or events, most notably excluding damage from floods and earthquakes.
The table below highlights exactly what types of events your homeowners insurance might have you covered and when they won't.
|Incidents Covered By Home Insurance||Incidents Not Covered by Home Insurance|
|Fire and lightning||Water damage from flooding|
|Wind and hail||Earth movement or damage due to seismic activity|
|Falling objects||Nuclear Hazard|
|Riot or civil commotion||Intentional loss|
|Aircraft and vehicles||Government action|
|Collapse/damage due to weight of ice, snow, or sleet|
|Accidental discharge or overflow of water or steam|
|Sudden and accidental tearing apart, cracking, burning, or bulging|
|Sudden and accidental damage from artificially generated electrical current|
What Types of Liability Does Homeowners Insurance Cover?
Liability protection covers you and your family members if there is bodily injury or property damage caused to other people.
The good thing is that unlike the other types of coverage in your policy, liability insurance doesn't have a deductible that you must pay for out-of-pocket before your insurance company begins paying for the losses.
Home Insurance Covers Your Personal Liability
In detail, your standard homeowner's insurance covers the cost of damages that you and anyone else on your policy have caused.
Bodily Injury is Covered Under Your Home Insurance
Coverage kicks in when someone is injured in or around your home.
Say, Mary Beth, your best friend, comes over to your pre-war and Grendel, your large golden retriever, jumps on her out of excitement.
And then Mary Beth hits her head when she falls on the wood floor because Grendel is so heavy.
In this scenario, you are covered.
Mary Beth now hates you and Grendel with a vengeance because she suffered a concussion.
She also has PTSD and fears dogs so much that she crosses the street when she seems them.
If your now ex-friend sues you, your liability portion will pay for the cost of defending you in court and even pay for any monetary awards.
In addition, your policy also has no-fault medical coverage.
This means that Mary Beth can simply submit her medical bills to your insurance.
This is the case because your policy wants to avoid a claim filed against you.
Keep in mind that your insurance doesn’t pay for any medical bills incurred by you, your family, or your pet.
Property Damage You or Someone In Your Home Has Caused
This liability type will cover the cost of damage you do to someone else's property.
For example, your ten-year-old son throws a baseball in the house and it damages your Robert Longo “Falling Man” drawing before ricocheting and breaking a window.
Property damage would pay for both the window and the art, up to policy limits.
How Much Are Liability Limits for Home Insurance?
Liability limits generally start at about $100,000.
This is the common coverage amount that insurance companies offer. However, it’s a good idea to see if you should purchase a higher level of protection as these examples point out.
Let’s clarify that. The $100,000 personal liability insurance is actually too low.
Mary Beth’s fall and her subsequent medical expenses as well as a possible lawsuit can easily exceed that amount of protection.
For insurance companies like Progressive and Lemonade, they suggest a higher limit, around $300,000.
Many experts in the homeowners insurance market also agree with that amount.
How to Insure Your High-Value Possessions
There are four ways to protect your valuables and ensure that they are covered for their full worth.
One, if your valuables have sentimental value to you or are priceless, such as heirloom jewelry, it makes sense to get a dedicated individual policy so you get full coverage if a pricy item goes missing.
In short, the more valuable an item is, the more deserving it is to get a separate insurance policy for it. You’ll pay through your teeth, but at least you know you’ll have full coverage.
Two, a way to avoid paying higher insurance premiums for valuables is to buy a protection plan from the company or vendor that makes them.
Valuable items, particularly jewelry, often come with an optional buyer’s protection plan offered by the merchant.
Whether or not you should sign up for this option will depend on the provisions of the plan.
The third way is to simply purchase a policy that has a broader blanket coverage for specific categories.
Your fourth option is to add a “floater” or “rider” to your policy.
The Most Popular Policies: Umbrella Policy and Riders
What is an Umbrella Policy?
If you have enough assets and decide you need more coverage that your standard homeowners policy doesn’t cover, you should consider purchasing an umbrella or excess liability policy, which provides broader coverage and higher liability limits.
An umbrella policy is a liability insurance policy that supplements the personal liability portion of your home.
You should consider buying an umbrella liability policy that will kick in when your home or other liability coverage limits are exhausted.
Umbrellas are usually sold in $1 million increments up to $5 million.
In general, to add the umbrella, you’ll pay around $159-$200 extra from your standard policy for $1 million in coverage.
If you think about it, that’s not that much. Umbrella insurance is usually priced affordably.
Especially if you have expensive art and want to replace it because it has substantially appreciated in value since you purchased it.
How Much Liability Coverage Do You Need?
Just evaluate your risks and take a look at the assets you want to protect. This will help you in making a decision.
It’s important to know that unless you specifically request your expensive jewelry to be put on your policy, many insurers won’t cover it.
If you want coverage, the premium has to be adjusted accordingly.
When you pick a policy, be sure to discuss with your agent the appreciation and replacement rules, as jewelry, for example, is often not directly replaceable.
Before that, it’s a smart move to get your valuables appraised so the agent can calculate how much additional coverage you need.
What is a Rider and How Does It Affect Your Coverage?
A rider to your home insurance policy, also known as a “floater” allows you to add coverage above and beyond the standard insurance policy coverage.
The rider takes over when traditional or standard insurance coverage ends and typically covers the insured item against fire, loss, theft, or damage.
A floater or rider added to a traditional homeowners insurance policy will allow you to have added protection for certain items like jewelry that may be excluded from the standard policy or have low limits on your policy.
In fact, there is a “jewelry rider” that specifically covers your prized possessions.
This is a standalone policy meant to specifically insure your jewelry. The rider will protect every piece of valuable jewelry you own if any of them gets stolen or damaged.
When you add the jewelry rider, make sure you and your policy are on the same page.
You need to make sure that each valuable jewelry you own has an agreed upon itemized value listed in your policy.
This needs to be done so that there is no conflict in what a piece is worth if you have to make a claim.
Hurricane Sandy left a lot of New Yorkers in peril. That’s because some homeowners did not take out a policy for flood protection.
Standard homeowners insurance doesn’t include protection against flood damages.
Flood insurance protects your apartment and helps you recover from damages caused by flooding from excessive rainfall, tidal flooding, or wind-driven storm surge, as the NYC Housing Recovery put it.
Let’s say a torrential rain happens outdoors before coming into your apartment. That’s considered a flood and is not covered under your insurance.
The most common flood claim is water damage or overflow from your bathroom or kitchen that damages the apartment below you. That means leakage and overflows from bathtubs, sinks and toilets.
The damages, as a result, are widely known to be very expensive to fix.
That’s why coverage of overflow is necessary when you are living in an apartment building in New York and there’s an apartment below you.
Most insurance policies come with $100,000 worth of liability coverage, but since water damages happen a lot in apartment buildings, it’s wise to pay extra for added coverage.
Much of New York City is Considered Flood Zones
To determine whether you’re at risk to floods, visit the Federal Emergency Management Agency (FEMA) website to find out if your home is located in a flood zone.
But we can tell you now that 70,000 apartment buildings in New York is within a floodplain, which means that in any given year these buildings have a 1% chance of being flooded.
The Federal Government Can Help You Get Coverage for Flooding
The way to buy flood insurance is to get a federally-run insurance policy that’s only available from the National Flood Insurance Program (NFIP).
The policy doesn’t cover personal belongings or the contents in your home.
There is a way to insure contents against flood by taking a second flood insurance policy from the NFIP solely to cover items with $100K limits.
This is the only way to get interior items covered.
However, adding flood insurance has a high deductible and can be very expensive.
For instance, buying separate flood insurance will set you back between $1,000 and $4,000 per year over and above the $500 to $1,000 a year that most owners typically spend on their home insurance, especially if it’s “standard.”
But according to the Federal Emergency Management Agency, flood insurance costs are more modest, about $700 annually.
The cost varies depending on your flood risk, as well as the type of coverage, amount and deductible.
|Liability costs if someone is hurt on your property|
|Payment for a temporary place to live while your home is repaired or replaced|
|The age of your home|
Does Homeowners Insurance Affect Your Credit Score?
It takes a lot of work to find the best insurance policy that’s custom fit for you.
The last thing you need is to find out that your potential insurance policy will check your credit score.
Homeowners insurance considers your credit history when setting rates in most states and when giving you a quote. However, they don’t check the same information lenders and credit card issuers do.
Instead, they use credit-based insurance scores based on similar information from your credit report.
In other words, homeowners insurance that looks at your credit history will result in a soft inquiry on your credit report.
If they used a hard pull, your credit score may go down a lot.
What is a Hard Inquiry?
When you want to borrow money or apply for a new credit card, these things and more are allocated to you only after a hard pull on your credit.
The purpose is to show lenders your credit track record if you are making payments on time on your mortgage, and how well you manage your credit cards and other debts.
That’s the basic concept behind a hard credit inquiry, also known as a ‘hard pull’.
It’s important to note that a hard inquiry is the only type of credit inquiry that can impact your FICO score.
What is a Soft Inquiry?
It is true that homeowners insurance companies check your credit score when giving you a quote.
But they only do a “soft pull” or a “soft inquiry,” a type of inquiry that won't affect your credit score.
In this way, when applying for a homeowners policy, it has zero effect on your credit score.
The Age of Your Home
The older your house is, the more it will cost to insure it. That’s because your home may not be up to code.
The Materials That Make Up Your Home
If your building is made of brick, concrete or stone then your rate will be cheaper. If it’s wood, there may be a fire.
Security features like alarm systems, smoke detectors, deadbolt locks and other safety features can result in lower policy quotes.
So make sure your home has these forms of security and more because they reduce the likelihood of theft or damage.
Being Near a Fire Station
If you live near a fire station or hydrant, your home insurance quote will be lower than someone who lives in a remote area.
Home insurance quotes will be prohibitively expensive if you live in areas prone to hurricanes, earthquakes, wildfires and other natural risks.
Neighborhood Crime Rates
If you live in an area that’s known for crime or an area where there’s a history of many burglaries, your quote will be very high.
If you have a breed of dog that’s aggressive (for example, a pitbull or a rottweiler) your quote will be higher than median rates since your insurance may have to pay for the costs if your dog bites someone and that person sues you.
Here, shopping around is imperative. Some policies may refuse coverage because you have that type of dog.
As we discussed, if you have valuable items like expensive watches or art works, you will probably need extra coverage that will definitely increase your quote.
The insurer will consider you a risk and either drop you or increase your coverage costs if you’ve filed a good number of claims in the past.
How Homeowners Insurance Companies Determine Your Estimate
A homeowners insurance quote is an estimate of the price you’ll pay for a policy. It’s based on a broad range of factors.
It’s worth shopping around to find the best rate when you compare policy rates from several insurers.
That’s because each company uses its own formula to calculate your quote, making price rates vary widely.
Above all, it’s important to note that insurance companies won’t tell you exactly how they figured out your rate.
Which makes it more important for you to look at multiple companies before settling on the one that makes sense for you.
Keep in mind that the initial quote is only an estimate and may not precisely match the price you end up paying for coverage.
Key Factors That Go Into the Cost of Your Homeowners Insurance
While you won't know the exact formula for how each specific home insurance provider determines the final cost, you can know the general criteria.
Homeowners insurance rates are affected by many factors. According to the Insurance Information Institute (III), these include:
- Your home's square footage
- Building costs in your area, and your own home's construction, materials and features
- Local crime rates
- The likelihood of certain types of disasters, such as hurricanes
- Geographic location: the neighborhood you live in
- Whether a fire station is nearby.
III recommends that you get enough insurance to cover your costs.
Here are the examples in-depth on how your rate is determined:
- The repair or replacement of the structure of your home and personal possessions.
- The more it costs to rebuild your home if it’s damaged, the higher your quote is likely to be.
- The price to rebuild depends on the going rate of materials and labor costs and the square footage of your home.
- Liability costs if someone is hurt on your property
- Payment for a temporary place to live while your home is repaired or replaced
It’s important to note here that expensive items are covered up to a certain limit that will probably not cover their full value.
For example, if you are burglarized and your pearl necklace worth $2,000 gets stolen, you won’t get back the full value.
Your home insurance will always cover you up to your limit, and if your limit is $1,000 on jewelry, you will only get that amount. So what do you do?
You should think carefully here. Full coverage to compensate for your loss only happens if you buy insurance with a higher coverage on expensive goods.
In general, keep in mind that you should not be relying on homeowner insurance to cover valuables.
To keep coverage affordable, a standard policy has a relatively low limit of liability for theft which, according to the Insurance Information Institute, is only around $1,500.