What Affects the Cost of Homeowners Insurance?

Homeowners insurance is a necessary evil that most people can’t live without.
What Affects the Cost of Homeowners Insurance?
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Anne Johnson
Updated:
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Homeowners insurance is a necessary evil that most people can’t live without. According to insurance.com, the average homeowner in 2025 pays $2,601 a year for their insurance.
But how do insurance underwriters determine how much you will pay? There are numerous factors that go into establishing your premium.

Where Your House Is Located

Your state and your ZIP code are factors when determining your insurance rate. For example, according to insurance.com, Oklahoma had the highest homeowner’s insurance rates in 2025. The average rate in Oklahoma for a $300,000 home is $5,858 per year. The main reason is the abundance of storms with severe property losses.
Anne Johnson
Anne Johnson
Author
Anne Johnson was a commercial property and casualty insurance agent for nine years. She was also licensed in health and life insurance. She went on to own an advertising agency, where she worked with businesses. She has been writing about personal finance for 10 years.